At Inception, Which of the Following Options Would Have the Lowest

question 25

Multiple Choice

At inception, which of the following options would have the lowest value? Assume that the strike price of all the options is set equal to the current price of the underlying stock.

• A) Arithmetic average Asian call option.
• B) Geometric average Asian call option.
• C) Vanilla European call.
• D) Vanilla American call.

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Definitions:

Conformity Research

The study of how and why individuals align their attitudes, beliefs, and behaviors with those of a group, often under social pressure or influence.

Group Pressure

The influence exerted by a group to encourage a person to conform to the group's standards.

Behavior

The actions or reactions of an individual or group in response to external or internal stimuli.

Disruptive Group Member

An individual within a group who causes disturbances or hinders the group's progress towards goals, often through negative behavior or attitudes.