An Option to Sell an Asset Is Referred to as a Call

question 10

True/False

An option to sell an asset is referred to as a call, whereas an option to buy an asset is called a put.

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Definitions:

Long-Term Investments

Financial assets intended to be held for more than a year, including stocks, bonds, and real estate, for generating revenue or appreciating in value over time.

Sale of Bonds

The process by which a company or government issues bonds to investors in order to raise capital, effectively borrowing from the bond purchasers.

Interest

The cost of borrowing money or the return on invested funds, expressed as a percentage of the principal amount.