Which of the Following Is an Ingredient Necessary to Form

question 28

Multiple Choice

Which of the following is an ingredient necessary to form a contract?

• A)exemption clauses
• B)fairness
• C)privity
• D)capacity
• E)assignment

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Definitions:

CBOE Option Contract

A contract that gives the holder the right to buy or sell a specific quantity of a security at a specified price on or before a certain date, traded on the Chicago Board Options Exchange.

S&P 100 Index

An index comprising 100 major, blue chip companies across multiple industries in the United States, used to track stock market performance.

Bull Money Spread

An options strategy involving the purchase of a call option with a lower strike price and the sale of another call option with a higher strike price, aiming to profit from a moderate increase in the price of the underlying asset.

Calls

Financial derivative options that give buyers the right, but not the obligation, to buy a security at a specified price within a specified duration.