Which of the following statements regarding factors that affect call option prices is CORRECT?
A) The longer the call option has to run the smaller its value and the smaller its premium.
B) An option on an extremely volatile stock is worth less than one on a stable stock.
C) The price of a call option increases as the risk-free rate increases.
D) Two call options on the same stock will have the same value even if they have different strike prices.
E) If you observe a put option on a stock increase in value, a call option on the stock should also increase.
Correct Answer:
Verified
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