For a firm in a perfectly competitive industry, which of the following is TRUE?

At the expiration the premium of an option is equal to the option intrinsic value.

a. true b. false

When U.S. house prices began to fall in 2007:

A. most people negotiated lower mortgage rates, so few were forced to sell their houses. B. banks made it difficult for homeowners to negotiate higher mortgage rates, which led to a decrease in the supply of houses. C. many Americans were forced to sell their homes because they could no longer take out loans against the rising value of their houses. D. the demand for affordable housing increased, leading house prices to stabilize.