5/5/26, 12:55 AM Quiz 6 (covering Options): Spring 2026-IE 420-Financial Engineering-Sections GO, UO
Quiz 6 (covering Options)
Due Apr 30 at 11:59pm
Points 10
Questions 46
Time Limit None
Attempt History
Attempt Time Score
LATEST Attempt 1 10 minutes 10 out of 10
Score for this quiz: 10 out of 10
Submitted Apr 29 at 6:35pm
This attempt took 10 minutes.
Correct answer
Question 1
pts
In the lecture, an option is defined as:
A financial derivative that gives the buyer the right, but not the obligation, to buy or sell an asset at a specified price on
or before a certain date
A stock that pays a fixed dividend
A contract that must always be exercised
A loan agreement between two banks
Correct answer
Question 2
pts
In the phrase “the right, but not the obligation,” the word “right” means:
The buyer owns the company
The buyer is allowed to choose whether to use the contract
The buyer automatically earns a profit
The buyer must use the contract
Correct answer
https://canvas.illinois.edu/courses/65661/quizzes/414693 1/13
, 5/5/26, 12:55 AM Quiz 6 (covering Options): Spring 2026-IE 420-Financial Engineering-Sections GO, UO
Question 3
pts
In the same phrase, “not the obligation” means:
The buyer must wait until expiration
The buyer does not have to exercise the option
The seller may ignore the contract
The option has no premium
Correct answer
Question 4
pts
A call option gives the holder the right to:
Sell an asset at a specified price
Receive dividends at a specified price
Borrow an asset at a specified price
Buy an asset at a specified price
Correct answer
Question 5
pts
A put option gives the holder the right to:
Receive interest at a specified price
Buy an asset at a specified price
Sell an asset at a specified price
Borrow cash at a specified price
Correct answer
Question 6
pts
In the lecture, the underlying asset is:
The option premium paid by the buyer
The profit earned from the strategy
The expiration date of the option
The security or asset that can be purchased or sold upon exercising the option
https://canvas.illinois.edu/courses/65661/quizzes/414693 2/13
Quiz 6 (covering Options)
Due Apr 30 at 11:59pm
Points 10
Questions 46
Time Limit None
Attempt History
Attempt Time Score
LATEST Attempt 1 10 minutes 10 out of 10
Score for this quiz: 10 out of 10
Submitted Apr 29 at 6:35pm
This attempt took 10 minutes.
Correct answer
Question 1
pts
In the lecture, an option is defined as:
A financial derivative that gives the buyer the right, but not the obligation, to buy or sell an asset at a specified price on
or before a certain date
A stock that pays a fixed dividend
A contract that must always be exercised
A loan agreement between two banks
Correct answer
Question 2
pts
In the phrase “the right, but not the obligation,” the word “right” means:
The buyer owns the company
The buyer is allowed to choose whether to use the contract
The buyer automatically earns a profit
The buyer must use the contract
Correct answer
https://canvas.illinois.edu/courses/65661/quizzes/414693 1/13
, 5/5/26, 12:55 AM Quiz 6 (covering Options): Spring 2026-IE 420-Financial Engineering-Sections GO, UO
Question 3
pts
In the same phrase, “not the obligation” means:
The buyer must wait until expiration
The buyer does not have to exercise the option
The seller may ignore the contract
The option has no premium
Correct answer
Question 4
pts
A call option gives the holder the right to:
Sell an asset at a specified price
Receive dividends at a specified price
Borrow an asset at a specified price
Buy an asset at a specified price
Correct answer
Question 5
pts
A put option gives the holder the right to:
Receive interest at a specified price
Buy an asset at a specified price
Sell an asset at a specified price
Borrow cash at a specified price
Correct answer
Question 6
pts
In the lecture, the underlying asset is:
The option premium paid by the buyer
The profit earned from the strategy
The expiration date of the option
The security or asset that can be purchased or sold upon exercising the option
https://canvas.illinois.edu/courses/65661/quizzes/414693 2/13
