An increase in which one of the following will decrease the value of a call option?
A) Interest rate
B) Time to expiration
C) Volatility of stock price
D)Exercise price

Question

Quizplus · Accepted Answer

An increase in exercise price will result in a decrease in the value of a call option. This is because as the exercise price increases, the option becomes less valuable as it becomes less likely that the stock price will exceed the exercise price and the option will be exercised.

An Increase in Which One of the Following Will Decrease