Which of the Following Statements About Put and Call Options

Multiple Choice

Which of the following statements about put and call options is true?

A) They are traded only over-the-counter.
B) They are a form of deferred equity financing by a firm.
C) They can be used to lock in a gain or prevent a loss on a stock holding.
D) They provide the seller with an opportunity to earn larger returns than simply buying or selling common stock.