Options exist when the owner of the option has the obligation to engage in certain types of transactions. The most common are stock options.

Question

Quizplus · Accepted Answer

Options exist when the owner of the option has the right but not the obligation to engage in certain types of transactions. The most common are stock options. A stock option grants the holder the right to buy (call option) or sell (put option) shares of the stock at a fixed price (strike price) at some time in the future.

Options Exist When the Owner of the Option Has the Obligation