The Lambda of an Option Is Defined As

question 3

Multiple Choice

The Lambda of an option is defined as:

• A) expected change in the option premium for a small change in time to expiration.
• B) expected change in the option premium for a small change in volatility.
• C) expected change in the option premium for a small change in the spot rate.
• D) expected change in the option premium for a small change in the domestic interest rate.

---

Definitions:

Remote Control

A device used to operate another device from a distance, commonly through infrared or wireless connectivity.

Norepinephrine

Norepinephrine is a neurotransmitter and hormone important in the body's fight or flight response, involved in increasing heart rate and blood pressure.

Sympathetic Nerve

Part of the autonomic nervous system that stimulates the body's fight or flight response.

Sympathetic Control

The regulation of bodily functions by the sympathetic nervous system, which activates the body's "fight or flight" response.