The Price of a Call Option Will Be Higher

question 59

Multiple Choice

The price of a call option will be higher,

• A)the higher the strike price is.
• B)the greater the volatility of the stock returns.
• C)the less time to expiration it has.
• D)the lower the interest rates.

Comprehend the impact of government fiscal policy choices on the economy.

Discuss the effect of open-market operations on the money supply and interest rates.

Evaluate the role and limitations of stabilization policy in achieving economic stability.

Identify the mechanisms through which automatic stabilizers affect the economy.

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Definitions:

Inversely Related

A term describing two variables that move in opposite directions; as one increases, the other decreases.

Inferior Good

A type of good for which demand decreases as the income of individuals increases, inversely related to the financial well-being of the consumer.

Tuna Fish Sandwiches

A type of sandwich made primarily from canned tuna fish and other ingredients such as mayonnaise and celery.

Substitutes

Goods or services that can be used in place of each other, satisfying the same needs or wants.