If an option's price increases 1.4 percent for every 2 percent change in the price of the underlying security,what is the value of the option's delta?
A)0.60.
B)1.40.
C)0.70.
D)2.00.

Question

Quizplus · Accepted Answer

The delta is the ratio of the change in the price of the option to the change in the price of the underlying security. 
Here, for every 2% change in the price of the underlying security, the option price increases by 1.4%. 
So, delta = (1.4/2) = 0.7. 
Therefore, the option's delta value is 0.70.

If an Option's Price Increases 1