The purchase of an option is also known as a:
A)call.
B)put.
C)hedge.
D)match.

Question

Quizplus · Accepted Answer

The purchase of an option is known as a call option. This gives the buyer the right, but not the obligation, to buy an underlying asset at a predetermined price (known as the strike price) within a set time period. Typically, call options are used as a way to speculate on the future movements of an asset, or as a way to protect against potential losses in an existing position.

The Purchase of an Option Is Also Known as A