An Options Contract Gives the Owner the ________ but Not

question 36

Multiple Choice

An options contract gives the owner the ________ but not the ________ to buy or sell an asset at a fixed price at some future date.

• A) obligation, right
• B) right, option
• C) right, obligation
• D) option, right

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Definitions:

Compounded Annually

Refers to the process of calculating interest on both the initial principal and the accumulated interest from previous periods, done once a year.

Monthly Payment

A fixed amount of money paid every month, often used in the context of loan or mortgage repayments.

Compounded Semi-annually

Refers to the process of applying interest to an initial sum and any accumulated interest on a semi-annual basis.

Monthly Payment

An amount of money that is regularly paid each month, often as part of a larger financial commitment or loan.