Options Exist When the Owner of the Option Has _____________

question 36

Multiple Choice

Options exist when the owner of the option has _____________ to engage in a transaction.

• A)the obligation but not the right
• B)the right but not the obligation
• C)the right and the obligation
• D)the neither the right nor the obligation

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Definitions:

Annuities

Financial products that pay out a fixed stream of payments to an individual, typically used as part of retirement planning.

Compounded Semi-Annually

An interest calculation method where interest is added to the principal sum of a deposit or loan at mid-year and end-of-year, resulting in interest earning interest.

Guaranteed Contract

An agreement ensuring certain terms are fulfilled, often used in the context of employment contracts guaranteeing payment.

Rate of Return

The gain or loss of an investment over a specified period, expressed as a percentage of the investment's initial cost.