When Does a Change in the Value of a Call

question 60

Multiple Choice

When does a change in the value of a call option come the closest to matching the price change in a share of stock?

• A) When the stock is priced far above the strike price.
• B) When the stock is priced far below the strike price.
• C) When the stock is priced very near the strike price.
• D) Changes in call value always come close to matching changes in stock price.

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Definitions:

Vestibular Sense

A sensory system located in the inner ear that contributes to balance and spatial orientation by detecting changes in motion and gravitational forces.

Kinesthesis

The sense that detects body position, movement, and balance, often referred to as the sense of muscular movement.

Cocking Head

The action of tilting or turning the head to one side, often as a gesture of curiosity, listening, or confusion.

Sound Location

The ability to identify the origin of a sound in space.