When a Company Writes a Call Option on New Stock

question 75

Multiple Choice

When a company writes a call option on new stock in the company,it is called a:

• A)convertible bond.
• B)put option.
• C)stock option.
• D)warrant.
• E)stock.

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Definitions:

Pool Funds

Combining resources or capital from multiple investors to form a larger investment fund, often managed professionally, allowing for diversified investments and shared risks.

Active Roles

In IT and business, active roles refer to the permissions or duties assigned to a user or employee that allow them to engage with certain data, systems, or tasks within an organization.

Running of Business

The day-to-day operations and management of a business, encompassing all aspects from production to marketing.

Best Efforts Underwriting

Underwriter sells as much of the issue as possible, but can return any unsold shares to the issuer without financial responsibility.