Consider the call option writing, the probability that a buyer would have positive payoff increases with the ___________?

Related Mcqs:

1. Consider the buying of put option, the probability that a buyer would have negative payoff increases with the ___________?

   A. increase in stock price
   B. decrease in stock price
   C. increase in maturity duration
   D. decrease in maturity duration

2. Consider buying the call option, if the price of stock falls then the buyer of call option has ___________?

   A. high potential of profit
   B. low potential of profit
   C. low potential of losses
   D. high potential of losses

3. Consider buying the call option, if the price of stock rises then the buyer of call option has __________?

   A. low potential of losses
   B. high potential of losses
   C. high potential of profit
   D. low potential of profit

4. If the stock price of call option is $300 and the exercise price of call option is $260 then the intrinsic value of option is ___________?

   A. 260
   B. 560
   C. 40
   D. 300

5. The intrinsic value of option is $280 and the price of option is $350 then the time value of option is ___________?

   A. 125
   B. 135
   C. 280
   D. 70

6. Consider buying the put option, if the price is lower at the expiration date of option then the ____________?

   A. liquidity will be higher
   B. loss will be higher
   C. profit will be lower
   D. profit will be higher

7. The type of option that gives the right to buyer to sell the underlying option at specific exercise price is considered as _____________?

   A. call option
   B. put option
   C. European option
   D. Australian option

8. The type of option that gives the right to buyer to buy the underlying option at specific exercise price is considered as _________?

   A. European option
   B. Australian option
   C. call option
   D. put option

9. If the time value of an option is $200 and the intrinsic value of an option is $250 then the price of option is _________?

   A. 50
   B. 550
   C. 200
   D. 250

10. If the intrinsic value of an option is $450 and the price of an option is $560 then the time value of an option is __________?

    A. 110
    B. 1010
    C. 450
    D. 560