Which One of the Following Variables Influences the Value of Put

question 66

Multiple Choice

Which one of the following variables influences the value of put options?I) Level of interest ratesII) Time to expiration of the optionIII) Dividend yield of underlying stockIV) Stock price volatility

• A) I and IV only
• B) II and III only
• C) I, II, and IV only
• D) I, II, III, and IV
• E) I, II, and III only

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Definitions:

Eurodollars

Deposits held in U.S. dollars at banks outside the United States, often used in international lending.

Repos

Short for repurchase agreements, a form of short-term borrowing for dealers in government securities.

Federal Funds

Funds in a bank’s reserve account at the Federal Reserve Bank.