A Stock Currently Sells for $150 Per Share

question 41

Multiple Choice

A stock currently sells for $150 per share.A call option on the stock with an exercise price $155 currently sells for $2.50.The call option is

• A) At-the-money.
• B) In-the-money.
• C) Out-of-the-money.
• D) At breakeven.
• E) None of the above.

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Definitions:

UCC's Classification

A system of categorizing and standardizing commercial transactions and instruments, established under the Uniform Commercial Code.

Perfect

Complete and absolute, often used in legal contexts to describe a state in which rights or securities are fully enforceable.

Security Interest

A legal claim or right granted by a borrower to a lender over the borrower's assets as collateral for a loan.

Security Interest

A legal claim on assets granted to a creditor to secure a loan, ensuring priority payment in the event of the debtor's default.