If the Sum of the External Torques Acting on an Isolated

question 65

Multiple Choice

If the sum of the external torques acting on an isolated system of particles is zero,it must be true that

• A)the system can have no kinetic energy.
• B)the angular momentum of the system does not change.
• C)the system can have no angular velocity.
• D)the system can have no linear velocity.
• E)the angular momentum of the system must be continually decreasing.

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Definitions:

Exercise Price

The predetermined price at which the holder of an option can buy (call) or sell (put) the underlying asset or security.

Black-Scholes

A mathematical model used to determine the theoretical price of European-style options, factoring in time, volatility, interest rates, and dividend payments.

Intrinsic Value

The lower bound of an option’s value, or what the option would be worth if it were about to expire.

Out Of The Money

Refers to an option that would not result in a profit if exercised immediately because its strike price is less (for a call) or more (for a put) than the market price of the underlying asset.