Option rate method &1 is not allowed for &2

What causes this issue?

Settings are made in Customizing to determine which option rate methods
are permitted for which object types. The option rate method &V1&
chosen here is not permitted for object type &V2&.

System Response

The system will not accept your entries.

How to fix this error?

Choose an option rate method that is permitted for object type &V2&. If
you consider that the option rate method you have chosen should be
permitted, make the necessary changes in Customizing for
<DS:SIMG.REFXV_TIVITOPTMETH>Option Rate Methods</> or ask your system
administrator to do so.

Procedure for System Administrators

The system issues an error message and will not allow you to continue with this transaction until the error is resolved.

Error message extract from SAP system. Copyright SAP SE.