Which of the Following Is True When There Are Dividends

question 18

Multiple Choice

Which of the following is true when there are dividends

• A) It is never optimal to exercise a call option on the stock early
• B) It can be optimal to exercise a call option at any time
• C) It is only ever optimal to exercise a call option immediately after an ex-dividend date
• D) None of the above

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Definitions:

Cis

Describes an isomer where two substituents are on the same side of a double bond or ring structure.

Geminal

Referring to atoms or groups that are attached to the same carbon atom within a molecule.

Ultrapure Dimethylamine

A highly purified form of dimethylamine, which is an organic compound used in the synthesis of a wide range of chemicals.

Proton Spectrum

The range of frequencies or energies that protons exhibit in nuclear magnetic resonance (NMR) spectroscopy, revealing molecular structure.