Vidyalelo
Commerce · Q645

Financial Management

Graduate and Post Graduate · Commerce · question 645

Q645

In financial planning, most high option price will lead to

A.
longer option period
Answer
B.
smaller option period
C.
lesser price
D.
higher price

Answer: Option A

Solution

Answer: Option A
Solution:
In financial planning, most high option price will lead to longer option period. option period is a time frame or period of time, which is valid for an option to be exercised before or on the expiration date. On the expiration date, the investor no longer has a choice but has to exercise the option.