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

Question

Quizplus · Accepted Answer

Real option refers to an option that has an underlying asset that is a physical asset, such as real estate, oil, or commodities. An office building is an example of a physical asset, making D the correct choice. Financial option (A) refers to options with underlying financial assets, such as stocks or bonds. Liquid option (B) and fixed option (C) are not commonly used terms in finance. Concrete option (E) is not a commonly used term in the context of options.

Which One of the Following Terms Applies to an Option