All Other Factors Equal, the ________ the Expected Volatility (As

question 24

Multiple Choice

All other factors equal, the ________ the expected volatility (as measured by ________) of the price of the underlying asset, the more an investor would be willing to pay for the option, and the more an option writer would demand for it.

• A) lower; the variance
• B) lower; the standard deviation
• C) greater; beta
• D) greater; the standard deviation

---

Definitions:

Fixation

A psychological term for an obsessive focus or attachment to someone or something, potentially hindering personal development.

Stroop Effect

A psychological phenomenon that demonstrates the interference in the reaction time of a task when the color of words on a test and their meaning differ.

Visual Processing

The process through which the brain deciphers visual data to comprehend and engage with the surroundings.

Algorithm

A step-by-step procedure or formula for solving a problem or completing a task.