An "Option" Is

question 24

Multiple Choice

An "option" is

• A)a contract giving the seller (writer)of the option the right,but not the obligation,to buy (call)or sell (put)a given quantity of an asset at a specified price at some time in the future.
• B)a contract giving the owner (buyer)of the option the right,but not the obligation,to buy (call)or sell (put)a given quantity of an asset at a specified price at some time in the future.
• C)a contract giving the owner (buyer)of the option the right,but not the obligation,to buy (put)or sell (call)a given quantity of an asset at a specified price at some time in the future.
• D)a contract giving the owner (buyer)of the option the right,but not the obligation,to buy (put)or sell (sell)a given quantity of an asset at a specified price at some time in the future.

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Definitions:

Public Goods

Goods that are non-excludable and non-rivalrous, meaning no one can be prevented from using them and one person's use does not reduce their availability to others.

Collective Benefits

Advantages or positive outcomes that are shared and enjoyed by all members of a group or society, not just by the individual who incurred the cost.

Excludable

A characteristic of a good or service that allows owners or producers to prevent others from using it without permission.

Over Supplied

A market condition where the quantity of a good or service available exceeds the quantity demanded at the current price, often leading to a surplus and typically pressure on prices to decrease.