agulani

revenant Wrote:
-------------------------------------------------------
> CareerThruCFA Wrote:
> --------------------------------------------------
> -----
> > For two European put options that differ only
> in
> > their time to expiration, which of the
> following
> > is most accurate? The longer-term option:
> >
> > A) can be worth less than the shorter-term
> option.
> >
> >
> > B) can be worth more than the shorter-term
> option.
> >
> >
> > C) can be worth at least as much as the
> > shorter-term option.
> >
> >
> > Very tricky,(I also selected C) The answer is
> A,
> > it could be all of them and most accurate is A
> > because european options can not be excercised
> > until the contact expiration date.
>
> Sorry I still don't get your explanation. Mind
> elaborating further?
>
> Thanks.


Please refer to LOS 70i (Schweser Book 5, Page 207).