Which of the Following Best Defines a European Options

question 330

Multiple Choice

Which of the following best defines a European options?

• A) A bond that can be exchanged for a fixed number of shares of stock for a specified amount of time.
• B) An option granted to an employee by a company giving the employee the right to buy shares of stock in the company at a fixed price for a fixed time.
• C) An option that can be exercised only on the expiration date.
• D) The act of buying or selling the underlying asset via the option contract.
• E) The last day on which an option can be exercised.

---

Definitions:

Relevant Range

The range of activity within which the assumptions about fixed and variable cost behavior are valid.

Activity Level

A measure of the volume of production or operations, which can affect the costs and efficiency of manufacturing processes.

Factory Overhead

Refers to all indirect manufacturing costs, including but not limited to utilities, maintenance, and depreciation related to the production process.

Conversion Costs

The combination of labor and manufacturing overhead costs necessary to convert raw materials into finished goods.