You Recently Purchased Six Put Option Contracts on a Stock

question 7

Multiple Choice

You recently purchased six put option contracts on a stock with an exercise price of $45 and an option premium of $.65. What is the total intrinsic value of these contracts if the stock is currently selling for $46.20 a share?

• A) −$360
• B) −$120
• C) $0
• D) $420
• E) $750

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Definitions:

Van der Waals Interaction

A type of weak interaction between molecules due to transient electric dipole moments, influencing molecular structure and function.

Ionic Bond

A type of chemical bond formed through the electrical force between oppositely charged ions.

Calorie

A unit of energy often used to quantify the amount of energy food provides to the human body.

Van der Waals Interaction

A weak force of attraction between molecules or parts of molecules that results from transient fluctuating electrical charges.