A Stock Has a Price of $68 Per Share

question 5

Multiple Choice

A stock has a price of $68 per share. A two-month put (strike price = $70) on the stock is available at a $6 premium. The intrinsic value on the put is:

• A) $0 and its time value is $6.
• B) $0 and its time value is $4.
• C) $2 and its time value is $4.
• D) $4 and its time value is $2.

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Definitions:

Minorities

Groups in a population that are smaller in number and often differentiated by ethnicity, race, religion, or other identifying factors, sometimes facing social disadvantages.

In God We Trust

The official motto of the United States, adopted in 1956, which appears on American currency and symbolizes the country's acknowledgment of religion in public life.

Currency

The system of money in general use in a particular country, region, or economic system, facilitating trade and economic activities.

1950s

A decade marked by post-World War II recovery, significant socioeconomic growth, the beginning of the Cold War, and cultural transitions in many parts of the world.