An Increase in __________ Will Have a Negative Effect on the Price

question 48

Multiple Choice

An increase in __________ will have a negative effect on the price of a put option.

• A) The underlying stock price.
• B) The time to maturity.
• C) The risk-free rate of interest.
• D) The dividend yield.
• E) The volatility of the underlying stock.

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Definitions:

Personality Traits

Enduring characteristics or behaviors that define an individual's patterns of thought, emotion, and behavior.

Neuroticism

A personality trait characterized by long-term tendency to be in a negative or anxious emotional state; it is not a disorder but one of the five major traits used to describe human personality.

Emotional Stability

A personality trait characterized by the ability to remain calm and composed, managing stress and negative emotions effectively.

Anxious

Experiencing worry, unease, or nervousness, typically about an imminent event or something with an uncertain outcome.