An option written without the stock to back it up is called


True or false: The single most important characteristic of an option is the participants are obligated to buy or sell an asset.

True or false: A writer creates the contract, sells it to the buyer, and must fulfill the option contract if it is exercised.

True or false: An option written without the stock to back it up is called a covered option.

True or false: A call option whose strike price exceeds the current stock price is called an  out-of-the-money call.

True or false: When the stock price goes up, the exercise value of the option is going up as well. However, the option time value goes down.

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Financial Management: An option written without the stock to back it up is called
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