4 The delta of a call option always equals A) the delta of an equivalent put option. B) the delta of an equivalent put option with a negative sign. C) the delta of an equivalent put option minus one. D) the delta of an equivalent put option plus one. 5 XIP Inc. just announces a major expansion into Internet of things. This announcement causes the price of its stock to decrease, because investors do not agree with management's decision to diversify, but also causes an increase in the volatility of the stock | Which of the following correctly identifies the impact of these changes on the price of XIP options? A) Both changes cause the price of the put option to increase. B) Both changes cause the price of the call option to decrease. C) The greater uncertainty will cause the price of the call option to decrease. The lower price of the stock will cause the price of the call option to increase. D) The greater uncertainty will cause the price of the put option to increase. The lower price of the stock will cause the price of the put option to decrease. 6 Suppose company Z is already in financial distress and the equity holders are very close to default. Suddenly there is a shock that causes an increase in the standard deviation of the return on company Z's assets. Which of the following correctly describes the new situation faced by company Z? A) Debt value will increase with the shock and equity holder are more likely to default. B) Equity value will increase with the shock and equity holder are less likely to default. C) Both Debt value and equity value will increase but the likelihood of default is unchanged. D) Both debt value and equity value will decrease and the likehood of default will increase