Which one of the following terms applies to an option that has an office building as its underlying asset?

Question

Quizplus · Accepted Answer

Real options are options whose underlying asset is a tangible asset, such as a building or a piece of land. Therefore, an option that has an office building as its underlying asset would be considered a real option. Financial options refer to options whose underlying asset is a financial instrument, such as a stock or a bond. Implicit option, fixed option, and concrete option are not commonly used terms in finance.

Which One of the Following Terms Applies to an Option