Which of the following statements is FALSE?
A) An American call on a non-dividend-paying stock has the same price as its European counterpart.
B) The price of any call option on a non-dividend-paying stock always exceeds its intrinsic value.
C) It is never optimal to exercise a call option on a dividend-paying stock early-you are always better off just selling the option.
D) If present value of the dividend payment is large enough,the time value of a European call option can be negative,implying that its price could be less than its intrinsic value.
Correct Answer:
Verified
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