SIE practice questioneasyCall options
Which statement is true about the buyer of a call option?
- AThey have the right to buy the underlying stock at the strike price✓ Correct answer
- BThey have the obligation to buy the stock
- CThey have the right to sell the stock at the strike price
- DThey must receive an assignment notice
Explanation
Why A — They have the right to buy the underlying stock at the strike price
Call buyers have the right (not the obligation) to purchase underlying shares at the strike price. B and D are incorrect regarding rights, and C describes puts.
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