The Delta of a Call Option Is 0

question 19

Multiple Choice

The delta of a call option is 0.6.The current price of the call is $5 and the stock is at $100.What is the approximate price of the call if the stock price increases to $100.50?

• A)$4.70
• B)$5.30
• C)$5.60
• D)$8.00

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Definitions:

Debenture

A type of debt instrument that is not secured by physical assets or collateral but is backed only by the general creditworthiness and reputation of the issuer.

Mortgage Bond

A bond secured by real estate.

Par Value

The nominal or face value of a bond, share of stock, or coupon as indicated on a bond or stock certificate. It is a static value determined at the time of issuance.

Face Value

The nominal value stated on a financial instrument, such as a bond or stock certificate.