Other things held constant, the value of an option depends on the stock's price, the risk-free rate, and the

Question

Quizplus · Accepted Answer

The value of an option is determined by several factors, including the underlying stock's price, the risk-free rate, the variability of the stock price (measured by the standard deviation), the option's time to maturity, and the strike price. Therefore, all of the above factors should be considered when determining the value of an option.

Other Things Held Constant, the Value of an Option Depends