Finance Mcqs

An option that gives investors right to sell a stock at predefined price is classified as____________?

(A) Put option

(B) Call option

(C) Money back options

(D) Out of money options

Submitted By: Ali Uppal


An increase in value of option leads to low present value of exercise cost only if it has____________?

(A) Low volatility

(B) Interest rates are high

(C) Interest rates are low

(D) High volatility

Submitted By: Ali Uppal


In financial planning, most high option price will lead to__________?

(A) Longer option period

(B) Smaller option period

(C) Lesser price

(D) Higher price

Submitted By: Ali Uppal


An investor who writes stock call options in his own portfolio is classified as__________?

(A) Due option

(B) Covered option

(C) Undue option

(D) Uncovered option

Submitted By: Ali Uppal


An investor who buys shares and writes a call option on stock is classified as__________?

(A) Put investor

(B) Call investor

(C) Hedger

(D) Volatile hedge

Submitted By: Ali Uppal


Greater value of option, larger span of time value is usually results in__________?

(A) Shorter call option

(B) Longer call option

(C) Longer put option

(D) Shorter put option

Submitted By: Ali Uppal


If current price increases from lower to higher then an____________?

(A) Option value equal to one

(B) Option value will increase

(C) Option value will decrease

(D) Option value equal to zero

Submitted By: Ali Uppal


According to Black Scholes model, selling and buying of stock have_______?

(A) Discount rate

(B) Transaction costs

(C) No transaction costs

(D) No discounts

Submitted By: Ali Uppal


Submitted By: Ali Uppal


Cost which has occurred already and not affected by decisions is classified as______________?

(A) Sunk cost

(B) Occurred cost

(C) Weighted cost

(D) Mean cost

Submitted By: Ali Uppal