All Other Things Held Constant,premiums on Call Options Will Increase

question 65

Multiple Choice

All other things held constant,premiums on call options will increase when the

• A) exercise price falls.
• B) volatility of the underlying asset falls.
• C) term to maturity decreases.
• D) futures price increases.

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Definitions:

Prefrontal Cortex

The front part of the frontal lobes of the brain, involved in decision making, social behavior, and personality expression.

Amygdala

A region of the brain involved in experiencing emotions, especially those related to survival, such as fear and aggression.

Hypothalamus

A region of the brain below the thalamus, responsible for coordinating both the autonomic nervous system and the activity of the pituitary, controlling body temperature, thirst, hunger, and other homeostatic systems.

Dorsal Anterior Cingulate Cortex

A region of the brain involved in cognitive functions, including decision making, impulse control, emotion, and anticipation of reward, often linked to the regulation of physical and emotional pain.