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The amount the buyer pays to acquire an option is called the:

AProvision
BPercentage
CPremium
DPrincipal
Answer & Solution
Correct answer: C. Premium
1. The right is not free. 2. A payment is made up front to the writer. 3. That payment is the premium. _Source: OpenStax Principles of Finance, Chapter 20, Risk Management and the Financial Manager._
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