If You Purchase the Right to Sell a Share of IBM

question 50

Multiple Choice

If you purchase the right to sell a share of IBM stock for a set price for a fixed period of time,then you have

• A) sold a call option.
• B) purchased a call option.
• C) purchased a put option.
• D) sold a put option.

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Definitions:

Product Cost

The total costs associated with making or acquiring a product, including direct materials, direct labor, and manufacturing overhead.

Period Cost

Costs that are expensed in the period they are incurred and are not directly tied to production, including selling, general, and administrative expenses.

Indirect Labor

Labor costs associated with the production process but not directly working on the product, such as supervisors, maintenance, and cleaning staff.

Product Cost

The total costs associated with producing a product, including direct materials, direct labor, and manufacturing overhead.