What Is the Term for the Costs That Come from the Use

question 54

Multiple Choice

What is the term for the costs that come from the use of the owner's own resources and therefore are not actually paid out in money?

• A)Sunk costs.
• B)Explicit costs.
• C)Implicit costs.
• D)Depreciation.

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Definitions:

Put Option Contracts

Financial contracts giving the owner the right, but not the obligation, to sell a specified amount of an underlying asset at a set price within a specified time.

Exercise Price

Also known as the strike price, it’s the specified price at which an option contract can be exercised, determining the price at which the underlying security can be bought or sold.

Option Price

The premium that must be paid by the buyer to the seller to acquire the rights that the option confers, without the obligation to buy (call) or sell (put) the underlying asset.

Treasury Bills

Short-term government securities issued at a discount from par value and pay no interest, maturing in a year or less.