Which of the Following Statements Is FALSE

question 37

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:

Water Cycle

The endless cycle of water moving across, above, and beneath the Earth's surface, which includes activities like evaporation, condensation, precipitation, and infiltration.

Hydrogen Cycle

The biogeochemical cycle of hydrogen, which involves the movement and exchange of hydrogen atoms between the biosphere, lithosphere, atmosphere, and hydrosphere.

Phosphorus Cycle

A biogeochemical cycle that describes the movement of phosphorus through the lithosphere, hydrosphere, and biosphere.

Ecological Efficiency

The efficiency with which energy is transferred from one trophic level to the next in a food chain.