unit 4 (invts)

Quiz by Robert Couch

Feel free to use or edit a copy

includes Teacher and Student dashboards

### Measure skillsfrom any curriculum

Measure skills

from any curriculum

Tag the questions with any skills you have. Your dashboard will track each student's mastery of each skill.

With a free account, teachers can

- edit the questions
- save a copy for later
- start a class game
- automatically assign follow-up activities based on students’ scores
- assign as homework
- share a link with colleagues
- print as a bubble sheet

### Our **brand new** solo games combine with your quiz, on the same screen

Correct quiz answers unlock more play!

24 questions

Show answers

- Q1Implies that immediate exercise would generate a positive cash flow.Black-Scholes formulain the moneyimplied volatilityout of the money30s
- Q2Implies that immediate exercise would generate a negative cash flow.Black-Scholes formulaout of the moneyin the moneyimplied volatility30s
- Q3The standard deviation of stock returns that is consistent with an option’s market value.in the moneyout of the moneyimplied volatilityBlack-Scholes formula30s
- Q4Uses the stock price, the risk-free interest rate, the time to expiration, and the standard deviation of stock returns to estimate the value of an option for that stock.implied volatilityout of the moneyin the moneyBlack-Scholes formula30s
- Q5Involves buying both a put and call option for the same expiration date and strike price on the same underlying security.collarportfolio insurancestraddledelta30s
- Q6Involves buying an out-of-the-money put option while simultaneously writing an out-of-the-money call option.collardeltastraddleportfolio insurance30s
- Q7A ratio that compares the change in the price of an underlying asset with the change in the price of a derivative or option.straddledeltacollarportfolio insurance30s
- Q8A strategy designed to protect a portfolio of investments against potential losses.straddledeltacollarportfolio insurance30s
- Q9Option values increase with greater volatility, all else equal.FALSETRUE……30s
- Q10Option values decrease with greater volatility, all else equal.FALSE…TRUE…30s
- Q11Optiona values increase with greater time-till-experiation, all else equal.TRUE…FALSE…30s
- Q12Optiona values decrease with greater time-till-experiation, all else equal.……TRUEFALSE30s
- Q13American options are typically worth more (or at least as much as) than European options.TRUEFALSE……30s
- Q14European options are typically worth more (or at least as much as) than American options.FALSETRUE……30s
- Q15If banks think the government will bail them out in the event of a crisis, this increases their incentive to take on more risk.……TRUEFALSE30s