Which One of the Following Statements Is Correct

question 49

Multiple Choice

Which one of the following statements is correct?

• A) The value of a call option decreases as the time to expiration increases.
• B) A decrease in the risk-free rate decreases the value of a put option.
• C) Increasing the risk-free rate decreases the value of a call option.
• D) The value of a put option increases when the standard deviation of the returns on the underlying stock increase.
• E) Increasing the strike price decreases the value of a put option.

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