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2. Which of the following statements about options on Warwick plc stock, a non-dividend-paying stock, is/are true? (a) The current value of a short American
2. Which of the following statements about options on Warwick plc stock, a non-dividend-paying stock, is/are true? (a) The current value of a short American call option is minus the current value of the corresponding long European call option with the same strike price and maturity. (b) The current value of a short American put option is minus the current value of the corresponding long European put option with the same strike price and maturity. (c) If the option is sufficiently in-the-money and the risk-free rate is positive, the value of a long European put option is strictly less than the payoff to the put option. * (a) only. (b) only. (c) only (a) and (c) only (a), (b) and (c)
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