The buyer of a European call option has the:
A) Right but not the obligation to buy a stock at a specified price on a specified date.
B) Right but not the obligation to buy a stock at a specified price during a specified period of time.
C) Obligation to buy a stock on a specified date but only at the specified price.
D) Obligation to buy a stock sometime during a specified period of time at the specified rice.
E) Obligation to buy a stock at the lower of the exercise price or the market price on the expiration date.

Question

Quizplus · Accepted Answer

European call options give the holder the right, but not the obligation, to buy an asset at a specified price (the strike price) on the expiration date. Unlike American options, they cannot be exercised before the expiration date.

The Buyer of a European Call Option Has The