When Volatility Increases with All Else Remaining the Same,which of the Following

question 9

Multiple Choice

When volatility increases with all else remaining the same,which of the following is true?

• A) Both calls and puts increase in value
• B) Both calls and puts decrease in value
• C) Calls increase in value while puts decrease in value
• D) Puts increase in value while calls decrease in value

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Definitions:

Chemical Reactions

Processes by which substances interact to form new products, involving the rearrangement of atoms and changes in chemical properties.

ADP

Adenosine Diphosphate (ADP) is an important organic compound in metabolism, used for energy transfer in cells.

Intermolecular Forces

Forces of attraction or repulsion which act between neighboring particles (atoms, molecules, or ions).

Electrostatic Attractions

The force of attraction between particles with opposite charges, fundamental in chemical bonding and interactions.