1. The price of the stock underlying an option is $57 and you purchase a December $55 call. This call is said to be what in term of its moneyness?
   1. at the money
   2. in the money
   3. out of the money
   4. deep out of the money
   5. none of the above

2. Which of the following variables in the Black-Scholes-Merton option pricing model is the most difficult to obtain?

a. the implied volatility

b. the risk-free rate

c. the stock price

d. the time to expiration

e. the exercise price

16. Which of the following statements regarding the VIX Index is not true?

1. It is a popular measure of the implied volatility of S&P 500 index
2. The VIX is calculated by the Chicago Board Options Exchange (CBOE).
3. Often referred to as the fear index or the fear gauge.
4. It is calculated using historical volatility of the S&P 500 Index
5. The VIX represents one measure of the market's expectation of stock market volatility over the next 30-day period