Before Expiration, the Time Value of a Call Option Is

question 24

Multiple Choice

Before expiration, the time value of a call option is equal to

• A) zero.
• B) the actual call price minus the intrinsic value of the call.
• C) the intrinsic value of the call.
• D) the actual call price plus the intrinsic value of the call.

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Definitions:

Wishes and Desires

Internal drives or motivations aimed at obtaining satisfaction, pleasure, or the fulfillment of something wanted or sought after.

Forebrain

The anterior part of the brain, including the cerebrum and diencephalon, responsible for processing sensory information and controlling complex behaviors.

Thought and Memory

The cognitive activities involved in processing, storing, and recalling information, playing a crucial role in learning and decision-making.

Brain Stem

The brain region at the top of the spinal cord that includes the medulla and the pons.