The Distinction Between American and European Options Is That

question 7

Multiple Choice

The distinction between American and European options is that:

• A) American options trade in the United States,while European options trade in Europe
• B) American options can be exercised at any time until expiration,while European options can only be exercised at the time of expiration
• C) American options have a capped payoff,while European options traders can have unlimited profits or losses
• D) American options end in physical delivery of the underlying asset,while European options end in cash settlement
• E) None of these answers are correct.

---

Definitions:

Inertia Brake

An Inertia Brake is a type of brake system that utilizes the inertia of the vehicle or component (usually in trailers) for activation, providing additional braking force especially during deceleration or when going downhill.

Clutch Brake

Circular disc with friction surfaces on both sides mounted on the transmission input shaft; its purpose is to slow or stop the input shaft during initial shifts to prevent gear clash.

Creep Feature

A functionality in some vehicles that allows them to move very slowly without the driver pressing the accelerator, useful in traffic or for precise maneuvering.