When the Stock Price Has Risen Above the Exercise Price

question 13

Multiple Choice

When the stock price has risen above the exercise price, the value of a call option is equal to the stock price:

• A)less the value of the dividend.
• B)less the value of the option.
• C)less the present value of the exercise price.
• D)less the exercise price.

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Definitions:

Sellers

Individuals or entities that offer goods or services in exchange for financial compensation.

Supply Schedule

A table that shows the relationship between the price of a good and the quantity of that good a seller is willing to supply to the market at various prices.

Sellers

Individuals or entities that offer goods or services for sale in the marketplace.

Buyers

Individuals or entities that make purchases of goods and services either for personal use, resale, or use in production.