18-29.The Following Affect Option Premiums

question 44

Multiple Choice

18-29.The following affect option premiums:

• A) length in time of the option
• B) volatility of the market
• C) special provisions
• D) all of the above

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Definitions:

Dividends

Earnings distributed by a corporation to its shareholders from its profit.

Annual Amortization

The process of gradually writing off the initial cost of an asset over a period typically corresponding to the asset's useful life.

Investment Balance

The current value of all the investments held by an individual or entity.

Initial Value Method

The initial value method is an accounting approach where investments are recorded at their acquisition cost without subsequent adjustment for changes in market value.