The right to buy a given quantity of an underlying asset at a predetermined price on or before a specific date is called a(n):
A) put option.
B) option writer.
C) call option.
D) arbitrage contract.

Question

Quizplus · Accepted Answer

The right to buy a given quantity of an underlying asset at a predetermined price on or before a specific date is called a call option. Put option is the right to sell the underlying asset at a predetermined price, option writer is the seller of the option, and arbitrage contract is a contract designed to profit from market inefficiencies.

The Right to Buy a Given Quantity of an Underlying