The seller of a call option has the
A) right to buy shares at a specified price.
B) obligation to buy shares at a specified price if the option is exercised.
C) right to sell shares at a specified price.
D) obligation to sell shares at a specified price if the option is exercised.

Question

Quizplus · Accepted Answer

The seller of a call option has the obligation to sell shares at a specified price if the option is exercised. Option buyers (holders) have the right to exercise the option, and option sellers (writers) have the obligation to fulfill the terms of the contract if the option is exercised. In the case of a call option, the option seller is obligated to sell the underlying shares to the option buyer at the strike price.

The Seller of a Call Option Has the