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You Have Just Graduated and You Want to Start Your

question 59

Essay

You have just graduated and you want to start your own business.You have a degree in horticulture,so you have chosen to open a florist shop and plant nursery.What type of business entity will you choose? Explain its benefits and detriments in detail.


Definitions:

Call Option

A financial contract granting the buyer the right to buy an asset at a specified price before a set date.

Exercise Price

The cost at which the person holding the option has the right to purchase (in the case of a call option) or sell (in the case of a put option) the underlying asset.

Underlying Stock

This refers to the stock on which derivative contracts, such as options and futures, are based.

American Call

A type of call option that can be exercised at any time before its expiration date.

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