Examlex

Solved

The Value of a Listed Put Option on a Stock

question 55

Multiple Choice

The value of a listed put option on a stock is lower when:
I. The exercise price is higher.
II. The contract approaches maturity.
III. The stock decreases in value.
IV. A stock split occurs.


Definitions:

Bank

A financial institution licensed to receive deposits and make loans, in addition to offering various other financial services.

Electronic Funds Transfer

A digital transaction method where money is transferred from one account to another without the physical exchange of cash.

Drawer

A compartment for holding or storing items, or in financial terms, the person who writes a bill of exchange or check.

Payee

The party to whom payment of a promissory note is to be made.

Related Questions