Another name for the premium of the option is:
A) price paid by the option writer to the option buyer.
B) price paid by the option buyer to the writer of the option.
C) the per-share price that the option writer receives when the option is exercised.
D) the per-share prices that the option holder pays when the option is exercised.

Question

Quizplus · Accepted Answer

The premium of an option is the price paid by the option buyer to the writer (or seller) of the option. This is the cost to purchase the option contract itself, not the price paid or received if the option is exercised.

Another Name for the Premium of the Option Is