If a Microsoft January 20 Put Option with a Strike

question 138

Multiple Choice

If a Microsoft January 20 put option with a strike price of $20 was selling for $5.00 and the market price of the underlying Microsoft stock was $18.00, the price of the put option would be _______________.

• A)in-the-money
• B)out-of-the-money
• C)fairly priced
• D)not enough information to tell

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Definitions:

Discount Stores

General merchandise outlets that offer brand-name and private-label products at low prices.

Self-Service

A business model or technology that allows customers to perform services for themselves without the need for direct assistance from staff.

Fast Fashion

The rapid translation of high-fashion design trends by lower-cost manufacturer-retailers.

Online Retailing

B2C electronic commerce in which individual consumers directly buy goods or services over the Internet; also known as e-retailing.