The Sensitivity of Option Value to Change in the Underlying

question 24

Multiple Choice

The sensitivity of option value to change in the underlying asset value is called the ______.

• A) option delta
• B) option gamma
• C) option sigma
• D) option theta
• E) option vega

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Definitions:

Overjustification Effect

A phenomenon where providing external incentives for an activity already intrinsically rewarding leads to a decrease in intrinsic motivation.

Contingent Reward

A reinforcement strategy where rewards are given based on the achievement of specific criteria or performance.

Self-Perception Errors

Mistakes made when individuals evaluate their own behavior and qualities, often leading to inaccuracies in self-assessment.

Overjustification Effect

A phenomenon where providing excessive external rewards for an already internally rewarding activity can lead to a reduction in intrinsic motivation.