Assume That a $75 Strike Call Has a 1

question 1

Multiple Choice

Assume that a $75 strike call has a 1.0% continuous dividend,90 days until expiration and stock price of $72.00.What is the rho of the option as the interest rate changes from 6.0% to 5.0%?

• A) 0.07
• B) 0.12
• C) 0.16
• D) 0.20

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Definitions:

Loan

is a sum of money borrowed that is expected to be paid back with interest.

Receivables

Money owed to a business by its customers for goods or services that have been delivered or sold but not yet paid for.

Unsecured

Refers to a loan or credit that is not backed by collateral, meaning the lender takes on more risk and relies on the borrower's creditworthiness.

Internal Audits

Evaluations conducted by a company's own staff to assess its systems, controls, and operations for efficiency, effectiveness, and compliance.