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Management · Q524

International Finance and Treasury

Graduate and Post Graduate · Management · question 524

Q524

Consider buying of put option, probability that a buyer would have negative payoff increases with the

A.
increase in stock price
Answer
B.
decrease in stock price
C.
increase in maturity duration
D.
decrease in maturity duration

Answer: Option A

Solution

Answer: Option A
Solution:
Consider buying of put option, probability that a buyer would have negative payoff increases with the increase in stock price.