A Put Option Can Best Be Defined As

question 102

Multiple Choice

A put option can best be defined as:

• A) The right to buy an asset at a fixed price during a particular period of time.
• B) The right to sell an asset at a fixed price during a particular period of time.
• C) An option that can be exercised at any time until its expiration date.
• D) An option that can be exercised only on the expiration date.
• E) An option with payoffs in real goods.

---

Definitions:

Long-Term Investment

An investment held for an extended period, typically more than a year, to earn interest, dividends, or capital gains.

Maturity

Maturity indicates the date on which the principal or final payment is due to be paid on a loan, bond, or other financial instrument.

Sinking Fund

A fund that accumulates cash to pay off bonds when they are retired.

Interest Revenue

Income earned from lending money or investments in interest-bearing financial instruments.