A Share of Stock Is a ________ Option on the Value

question 40

Multiple Choice

A share of stock is a ________ option on the value of assets of the firm with a strike price equal to ________.

• A)put option,face value of debt
• B)call option,market value of equity
• C)call option,face value of debt
• D)put option,market value of equity
• E)put option,market value of debt

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Definitions:

Positive Reinforcer

A stimulus which, when presented after a behavior, increases the likelihood of that behavior being repeated.

Noxious Stimulus

An unpleasant or harmful stimulus that can cause pain or discomfort to an organism.

Unconditioned Stimulus

A stimulus that naturally and automatically triggers a response without any prior learning or conditioning.

Optimistic Bias

The tendency to believe that one is less likely than others to experience negative events and more likely to experience positive events.