Describe the effect on a call options price

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Reference no: EM131375826

1. Why do options sell at prices higher than their exercise values?

2. Describe the effect on a call option's price caused by an increase in each of the following factors: (1) stock price, (2) exercise price, (3) time to expiration, (4) riskfree rate, and (5) variance of stock return.

Reference no: EM131375826

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