{"id":44351,"date":"2024-04-15T21:42:31","date_gmt":"2024-04-15T21:42:31","guid":{"rendered":"https:\/\/exam.pscnotes.com\/mcq\/?p=44351"},"modified":"2024-04-15T21:42:31","modified_gmt":"2024-04-15T21:42:31","slug":"if-stock-market-price-is-higher-than-strike-price-so-call-option","status":"publish","type":"post","link":"https:\/\/exam.pscnotes.com\/mcq\/if-stock-market-price-is-higher-than-strike-price-so-call-option\/","title":{"rendered":"If stock market price is higher than strike price so call option"},"content":{"rendered":"<p>[amp_mcq option1=&#8221;price will be lower&#8221; option2=&#8221;rate will be higher&#8221; option3=&#8221;price will be higher&#8221; option4=&#8221;rate will be lower&#8221; correct=&#8221;option3&#8243;]<!--more--><\/p>\n<p>The correct answer is: C. price will be higher.<\/p>\n<p>A call option is a contract that gives the buyer the right, but not the obligation, to buy a specified amount of an underlying asset at a specified price on or before a specified date. The strike price is the price at which the buyer can exercise the option.<\/p>\n<p>If the stock market price is higher than the strike price, then the call option is in the money. This means that the buyer of the option can exercise the option and buy the stock at the strike price, which is lower than the current market price. This would make the call option more valuable, and the price of the option would increase.<\/p>\n<p>The other options are incorrect. Option A is incorrect because the price of a call option will increase if the stock market price is higher than the strike price. Option B is incorrect because the rate of a call option is the premium that the buyer pays for the option, and the premium is not affected by the stock market price. Option D is incorrect because the rate of a call option will decrease if the stock market price is lower than the strike price.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>[amp_mcq option1=&#8221;price will be lower&#8221; option2=&#8221;rate will be higher&#8221; option3=&#8221;price will be higher&#8221; option4=&#8221;rate will be lower&#8221; correct=&#8221;option3&#8243;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[945],"tags":[],"class_list":["post-44351","post","type-post","status-publish","format-standard","hentry","category-financial-management","no-featured-image-padding"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v22.2 (Yoast SEO v23.3) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>If stock market price is higher than strike price so call option<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/exam.pscnotes.com\/mcq\/if-stock-market-price-is-higher-than-strike-price-so-call-option\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"If stock market price is higher than strike price so call option\" \/>\n<meta property=\"og:description\" content=\"[amp_mcq option1=&#8221;price will be lower&#8221; 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