All Else Equal, If an Option's Strike Price Increases, Then

question 69

Multiple Choice

All else equal, if an option's strike price increases, then the

• A)value of a put option increases and that of a call option decreases.
• B)value of a put option decreases and that of a call option increases.
• C)value of both a put option and a call option increase.
• D)value of both a put option and a call option decrease.

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Definitions:

Hourly Wage

The amount of money paid to an employee for each hour worked, often set by legal minimum wage laws or by agreement between employer and employee.

Fringe Benefits

Fringe Benefits are additional benefits supplementing an employee's salary, such as health insurance, paid vacations, and retirement plans.

Winner-Take-All Markets

Markets in which the top performers or companies receive a disproportionately large share of the rewards, and the remaining competitors are left with very little.

Hourly Wage

The amount of money paid for each hour of work.