Explanation:
The price of a European put option increases when there is an increase in the strike price, expected dividends, or the volatility of the underlying asset. Conversely, an increase in the current stock price or the risk-free rate will generally cause the price of a put option to decrease.
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Q.83 An increase in which of the following factors is likely to cause the price of a European put option to increase?
A
Current stock price, dividends and volatility
B
Strike price, dividends and volatility
C
Dividends, risk-free rate and volatility
D
Risk-free rate and volatility
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