A Decrease in Which One of the Following Terms Will

question 78

Multiple Choice

A decrease in which one of the following terms will cause an increase in the call value of an option?

• A) Interest rates
• B) Time to maturity
• C) Exercise price
• D)Volatility of the stock

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Definitions:

Security Portfolio

A collection of investments held by an individual or an institution which may include stocks, bonds, mutual funds, or other investments.

Accounting Period

A time frame for which financial statements are prepared, typically a year, quarter, or month, to measure a company's financial performance.

Other Expenses

Costs that do not directly relate to the main business activities, such as administrative and organizational expenses.

Unrealized Loss Account

An account that reflects losses which have occurred on paper due to changes in market values but have not been actually realized through a transaction.