Which of the Following Statements Is False

question 24

Multiple Choice

Which of the following statements is false?

• A) Because an American option cannot be worth less than its intrinsic value, it cannot have a negative time value.
• B) An American option with a later exercise date cannot be worth less than an otherwise identical American option with an earlier exercise date.
• C) The value of an option generally decreases with the volatility of the stock.
• D) The intrinsic value is the amount by which the option is currently in-the-money or 0 if the option is out-of-the-money.

---

Definitions:

Sebum

An oily substance produced by the sebaceous glands to moisturize and protect the skin.

Conjunctiva

The thin, transparent tissue that covers the white part of the eye and lines the inside of the eyelids.

Esotropia

A condition characterized by the inward turning of one or both eyes.

Entropion

A medical condition where the eyelid folds inward, causing the eyelashes to rub against the eyeball, leading to irritation and discomfort.