Which of the Following Statements Is False

question 58

Multiple Choice

Which of the following statements is false?

• A) Option contracts are a zero sum game.
• B) If an in-the-money option is not exercised at expiration, you will lose money.
• C) It is possible for you to lose all of your investment in an option.
• D) One advantage to buying options on a stock rather than the stock itself is that it requires a smaller initial investment.
• E) As the price of a stock falls, the value of a put option on the stock also falls.

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Definitions:

Wood

A hard, fibrous material made of the trunks and branches of trees, used for construction, making furniture, and other purposes.

Production Function

An equation or model that describes the relationship between the inputs used in production and the output of goods or services.

Plastic

A wide range of synthetic or semi-synthetic materials that use polymers as a main ingredient and are malleable, making them suitable for various applications.

Wood

A natural, fibrous material derived from trees, widely used for construction, manufacturing, and fuel.