Which One of the Following Distinguishes an Option as an American

question 13

Multiple Choice

Which one of the following distinguishes an option as an American style option?

• A)option that grants its holder the right to purchase at the strike price
• B)option that grants its holder the right to sell at the strike price
• C)option that obligates its holder to sell at the strike price
• D)option that can be exercised at any time prior to expiration
• E)option that can only be exercised at expiration

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Definitions:

Blanket

In a general context, a large fabric designed for warmth, but in various fields can mean a broad coverage or application of something.

Partial

Incomplete or not whole; affecting only a part of something.

Transfer for Value

In insurance law, the assignment or transfer of a policy from the original policy owner to another party in exchange for consideration.

Negotiation

The process of discussing terms in order to reach a mutually acceptable agreement.