Which of the Following Correctly Identifies the Impact of These

question 32

Multiple Choice

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

• A) Both changes cause the price of the call option to decrease.
• B) Both changes cause the price of the call option to increase.
• C) The volatility normally will have a negative effect on the price of the call option while the lower price of the stock will cause the price of the call option to increase.
• D) The volatility normally will have a positive effect on the price of the call option while the lower price of the stock will cause the price of the call option to decrease.
• E) Volatility has no direct effect on the price of the call option while the lower price of the stock will cause the price of the call option to decrease.

---

Definitions:

Price Information

Data or details about the cost of goods or services, which helps consumers and businesses make purchasing decisions.

Ocean Liner

A large, passenger ship designed for long-distance voyages, often associated with luxury and transoceanic travel.

Lush Tropical Island

A region characterized by abundant vegetation, a warm climate, and located within the tropics, often considered ideal for tourism and agriculture.

Economy

The large set of interrelated economic production and consumption activities that aid in determining how scarce resources are allocated.