The Price Paid to Purchase an Option Contract Is Called

question 74

Multiple Choice

The price paid to purchase an option contract is called the:

• A)strike price.
• B)option premium.
• C)exercise price.
• D)future premium.
• E)current yield.

---

Definitions:

Cost of Goods Sold

The direct expenditures involved in the production of a company's sold goods, encompassing both materials and labor expenses.

Total Expenses

Total expenses refer to the sum of all costs and expenses incurred by a business during a specific period.

Perpetual Inventory System

A perpetual inventory system is a method of accounting for inventory that records the sale or purchase of inventory immediately through the use of computerized point-of-sale systems and enterprise asset management software.

Gross Method

An accounting approach to recording purchases at their full invoice amount without deducting any cash discounts offered.