Which of the Following Contracts Obligates a Buyer to Buy

question 32

Multiple Choice

Which of the following contracts obligates a buyer to buy or sell something at a later date?

• A)call
• B)futures
• C)cap
• D)put
• E)swaption

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Definitions:

Short Sale

A financial transaction where an investor sells borrowed securities, anticipating a price decline to buy them back at a lower price.

Mortgage Loan

is a type of loan used to purchase or maintain a home, land, or other types of real estate where the borrower agrees to pay back the lender over a period of time, typically through monthly payments.

Market Value

The current price at which an asset or service can be bought or sold in a fair and open market.

Right To Foreclose

The legal right of a lender or mortgage holder to seize property in the event of nonpayment of debt.