Compared with fixed- rate derivatives such as futures, an option:
A) is less expensive but less flexible.
B) is more expensive and less flexible.
C) is more expensive but more flexible.
D) is less expensive and more flexible.

Question

Quizplus · Accepted Answer

Options are generally more expensive than futures because they provide the right, but not the obligation, to buy or sell an asset, offering greater flexibility in terms of potential strategies and risk management.

Compared with Fixed- Rate Derivatives Such as Futures, an Option