The special contractual nature giving the owner the right to buy or sell an asset at a fixed price on or before a given date is the basis of:
A) a common stock.
B) a capital investment.
C) a futures.
D) an option.

Question

Quizplus · Accepted Answer

An option is a financial derivative that gives the buyer the right, but not the obligation, to buy (in the case of a call option) or sell (in the case of a put option) an asset at a specified price (the strike price) on or before a certain date (the expiration date). This contrasts with futures, common stocks, and general capital investments, which do not provide the same type of contractual rights to buy or sell assets at fixed prices.

The Special Contractual Nature Giving the Owner the Right to Buy