Which Option Gives the Right to Sell an Underlying Asset

question 2

Multiple Choice

Which option gives the right to sell an underlying asset at a fixed price?

• A)Put option.
• B)American option.
• C)Call option.
• D)European option.

---

Definitions:

Stock

A form of security that indicates the holder has proportionate ownership in the issuing corporation.

Dividends

These are distributions of a portion of a company's earnings, decided by the board of directors, to a class of its shareholders.

Shareholders

Individuals or entities that own shares in a corporation, thus having an interest in its performance and profitability.

Corporation

A legal entity that is separate from its owners, providing them with limited liability, and has the ability to own assets, incur liabilities, and sell shares.