A Call Option Is Said to Be in the Money

question 13

Multiple Choice

A call option is said to be in the money if

• A)it is written on a Treasury bill or other money-market asset.
• B)it has increased in price since it was first written.
• C)the price of the underlying asset is currently greater than the strike price.
• D)the price of the underlying asset is currently greater than the strike price plus the option premium.

---

Definitions:

Negative Reinforcers

In behavioral psychology, negative reinforcement is a process where an undesirable or harmful stimulus is removed after a particular behavior is exhibited, increasing the likelihood of that behavior being repeated in the future.

Extinction

In behavioral psychology, the process through which a conditioned response decreases or disappears as a result of repeated exposure without reinforcement.

Reinforcement

In psychology, a process by which a certain stimulus or action encourages a particular behaviour to occur again.

Punishment

The imposition of a penalty as retribution for an offense or undesirable behavior.