The option price will change as the price of the ________. For a ________, as the price of the underlying asset increases (all other factors constant), the option price increases. The opposite holds for a ________.

Question

Quizplus · Accepted Answer

The option price will change as the price of the underlying asset changes. For a call option, as the price of the underlying asset increases, the option price increases. The opposite holds for a put option. Therefore, the correct choice is B, where call option corresponds to an increase in the price of the underlying asset, and put option corresponds to a decrease in the price of the underlying asset.

The Option Price Will Change as the Price of the ________