Which Option Price(s)will Increase When the Dividend Yield Increases

question 3

Multiple Choice

Which option price(s) will increase when the dividend yield increases?

• A)both the call and put
• B)call only
• C)put only
• D)neither the call nor the put
• E)Answer cannot be determined from the information provided.

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Definitions:

Performance

The act of carrying out or accomplishing an action, task, or function, often measured against known standards of accuracy, completeness, and speed.

Stress Increases

Refer to situations or conditions that elevate levels of psychological or physical tension, often caused by challenges or demands.

Decrease

A reduction in size, amount, extent, or intensity of a particular thing or entity.

Level Off

The point at which something stops increasing or decreasing and remains consistent.