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The following site can be used to demonstrate how the features of an option affect the options prices. Go to http://www.hoadley.net/options/bs.htm. Scroll down to the
The following site can be used to demonstrate how the features of an option affect the options prices. Go to http://www.hoadley.net/options/bs.htm. Scroll down to the online options calculator. What happens to the price of an option under each of the following situations?
- The strike price increases.
- Interest rates increase.
- Volatility increases.
- The time until the option matures increases.
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