Which of the Following Is NOT True

question 20

Multiple Choice

Which of the following is NOT true

• A) A call option gives the holder the right to buy an asset by a certain date for a certain price
• B) A put option gives the holder the right to sell an asset by a certain date for a certain price
• C) The holder of a call or put option must exercise the right to sell or buy an asset
• D) The holder of a forward contract is obligated to buy or sell an asset

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Definitions:

Gross Profit

The financial metric that subtracts the cost of goods sold from sales revenue, representing the amount a company makes after covering the direct costs associated with production.

Selling Expenses

Costs associated with marketing and selling a company's products or services.

Net Income

Net income, also known as net profit, is the total earnings of a company after subtracting all expenses, taxes, and costs from total revenue.

Sales Tax

A tax imposed by a government on the sale of goods and services, typically a percentage of the retail price paid by the consumer.