Sample Question #148 (finance – option pricing)
[I know you guys love option-pricing questions, so here’s another one!]
What happens to the price of an option when the interest rate goes to infinity?
(Comment: I don’t know why, but option pricing questions are very popular on the quant interview circuit, even when a position will not deal with options at all. Of course, if you admit up-front that you know nothing or little about options, you’ll be spared of such questions.)