The difference between a put and a call option is that:
A)a put is an option to sell common stock at a specified price while a call is an option to buy common stock at a specified price.
B)a call is an option to sell common stock at a specified price while a put is an option to buy common stock at a specified price.
C)a call is an option to buy common stock at a specified price while a put is the option to buy preferred stock at a specified price.
D)a call is an option to sell common stock at a specified price while a put is the option to sell preferred stock at a specified price.

Question

Quizplus · Accepted Answer

The most widely known options are puts and calls on common stock. A put is an option to sell 100 shares of common stock at a specified price for a given period. Calls are the opposite of puts and allow the owner the right to buy 100 shares of common stock from the option seller (writer).

The Difference Between a Put and a Call Option Is