Which of the Following Statements Is Correct Concerning Call Options

question 39

Multiple Choice

Which of the following statements is correct concerning call options?

• A) Value of a call option at expiration will be greater than the stock price.
• B) Value of a call option at expiration will be equal to the exercise price.
• C) Value of a call option at expiration will be equal to the difference between the stock price and exercise price.
• D) Value of a call option at expiration will be equal to zero.

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Definitions:

Regression Equation

An equation that represents the relationship determined by regression analysis, predicting the dependent variable based on independent variables.

Dummy Variable

A variable used in regression analysis that assumes the value 0 or 1 to indicate the absence or presence of some categorical effect.

Independent Variable

A variable that is manipulated to determine its effect on a dependent variable within an experimental study.

3-ethyl-3-methylhexane

A branched alkane with the formula C8H18, having an ethyl and a methyl group on the third carbon of the hexane chain.