Which of the Following Statements Is False

question 50

Multiple Choice

Which of the following statements is false?

• A) Put-call parity gives the price of a European call option in terms of the price of a European put, the underlying stock, and a zero-coupon bond.
• B) For a given strike price, the value of a call option is higher if the current price of the stock is higher, as there is a greater likelihood the option will end up in-the-money.
• C) The value of an otherwise identical call option is higher if the strike price the holder must pay to buy the stock is higher.
• D) Because a put is the right to sell the stock, puts with a lower strike price are less valuable.

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