Multiple Choice
A longer time to maturity will unambiguously increase the value of a call option because:
I. The longer maturity time reduces the effect of a dividend on call price.
II. With a longer time to maturity the present value of the exercise price falls.
III. With a longer time to maturity the range of possible stock prices at expiration increases.
A) I only
B) I and II only
C) II and III only
D) I, II, and III
Correct Answer:
Verified
Correct Answer:
Verified
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