Which of the following statements is FALSE?
A)Put-call parity gives the price of a European call option in terms of the price of a European put,the underlying stock,and a zero-coupon bond.
B)For a given strike price,the value of a call option is higher if the current price of the stock is higher,as there is a greater likelihood the option will end up in-the-money.
C)The value of an otherwise identical call option is higher if the strike price of the option is higher.
D)Because a put is the right to sell the stock,puts with a lower strike price are less valuable.

Question

Quizplus · Accepted Answer

The value of a call option decreases as the strike price increases, because the likelihood of the option ending up in-the-money decreases.

Which of the Following Statements Is FALSE