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WAEC Commerce 2018 Question 23

Question 23

Stock Exchange

A put option in the stock exchange is an option

  1. A.to sell.
  2. B.not to sell.
  3. C.to buy.
  4. D.not to buy
Show the answer and explanation

Answer: A (to sell.)

Explanation

A put option gives the holder the right to sell shares at a fixed price within a period; a call option is the right to buy.