Select an option above to see an explanation here.

A) This is incorrect because as the expiration date approaches, the time value of an option decreases, not increases.
B) This is incorrect because the expiration date directly affects the time value of an option, with the time value decreasing as the expiration date approaches.
C) This is incorrect because the effect of the expiration date on time value is predictable; as the expiration date approaches, the time value decreases.
D) Time value decreases as expiration approaches.