Question
1.Which of the following statements about the effect of dividend payments on European put prices are true? Select one: a. Payment of an unexpected dividend
1.Which of the following statements about the effect of dividend payments on European put prices are true? Select one: a. Payment of an unexpected dividend on a stock during the life of a European put option will result in the put price increasing, all else remaining the same. b. Payment of an expected dividend on a stock during the life of a European put option will result in the put price increasing, all else remaining the same. c. To price a European put option on a stock paying a single dividend during the life of the option, you should adjust the Black-Scholes-Merton formula by subtracting the present value of the dividend from the stock price. d. Statements a. and b. are true e. Statements a. and c. are true f. Statements b. and c. are true g. Statements a., b. and c. are true
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