Selling an option is generally more valuable than exercising the option because of the option's:

Theta measures an option's:    A.  intrinsic value. B.  volatility. C.  rate of time decay. D.  sensitivity to changes in the value of the underlying asset. E.  sensitivity to risk-free rate changes. Refer to section 25.3

31.	Selling an option is generally more valuable than exercising the option because of the option's:    A.  riskless value. B.  intrinsic value. C.  standard deviation. D.  exercise price. E.  time premium. Refer to section 25.3

32.

Which of the following statements are correct? I. As the standard deviation of the returns on a stock increase, the value of a put option increases. II. The value of a call option decreases as the time to expiration increases. III. A decrease in the risk-free rate increases the value of a put option. IV. Increasing the strike price increases the value of a put option.    A.  I and III only B.  II and IV only C.  I and II only D.  I, III, and IV only E.  I, II, and III only Refer to section 25.3

33.	A decrease in which of the following will increase the value of a put option on a stock? I. time to expiration II. stock price III. exercise price IV. risk-free rate    A.  III only B.  II and IV only C.  I and III only D.  I, II, and III only E.  II, III, and IV only Refer to section 25.3