Which of the Following Correctly Identifies the Impact of These

question 38

Multiple Choice

Which of the following correctly identifies the impact of these changes on the put option of Tele-Tech Com?

• A) Both changes cause the price of the put option to decrease.
• B) Both changes cause the price of the put option to increase.
• C) The greater uncertainty will cause the price of the put option to decrease. The higher price of the stock will cause the price of the put option to increase.
• D) The greater uncertainty will cause the price of the put option to increase. The higher price of the stock will cause the price of the put option to decrease.
• E) The greater uncertainty has no direct effect on the price of the put option. The higher

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Definitions:

Production Process

The series of steps and operations involved in the creation of goods or services.

Inner Loop

In the context of the circular-flow diagram, it refers to the flow of goods and services from firms to households and the corresponding flow of money from households to firms.

Inputs And Outputs

The resources used in the production process (inputs) and the goods or services produced (outputs) in an economic system.

Production Possibilities Frontier

A curve depicting all maximum output possibilities for two goods, given a set of inputs and technology.