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Social Science Clinic => Business => Finance => Topic started by: cherise1989 on Apr 25, 2021

Title: Which of the following statements is TRUE?
Post by: cherise1989 on Apr 25, 2021

Question 1

Which of the following factors when increased does NOT increase a call option price, holding all else constant?
◦ Time to maturity
◦ Volatility
◦ The price of the underlying asset
◦ The strike price

Question 2

Which of the following statements is TRUE?
◦ Call options are in-the-money if the stock price is above the strike price. Put options are in-the-money if the stock price is below the strike price.
◦ Call options are in-the-money if the stock price is below the strike price. Put options are in-the-money if the stock price is above the strike price.
◦ Both call and put options are in-the-money if the stock price is above the strike price.
◦ None of these.

Title: Which of the following statements is TRUE?
Post by: ryhom on Apr 25, 2021

Answer 1

The strike price

Answer 2

Call options are in-the-money if the stock price is above the strike price. Put options are in-the-money if the stock price is below the strike price.