Question

Since investors tend to dislike risk and like certainty, the more volatile a stock, the less valuable will be an option to purchase the stock, other things held constant.A. True
B.False

Answer 1

Answer: false

Explanation: A volatile stock is a kind of stock where shares has a high tendency to easily rise or fall. A volatile stock is a high risk stock, where if an investor is lucky, he can gain big and if unlucky can loss big also.

The possibility of high gain would attract some investors to this kind of stock investment.