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If the Exchange Rate's Volatility Is Rising, and Therefore the Risk

question 29

True/False

If the exchange rate's volatility is rising, and therefore the risk of the option not being exercised is decreasing, the option premium would be increasing.


Definitions:

Conception

The process of a sperm fertilizing an ovum, resulting in the beginning of a pregnancy.

Age Of Viability

The age at which the fetus may survive if born prematurely; begins about 22 weeks after conception.

Neonatal Nurse

A nurse specializing in the care of newborn babies, particularly the ill or premature, during the first month of life.

Premature

Occurring or done before the usual or proper time; too early.

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