The Intrinsic Value of an Option Is

question 96

Multiple Choice

The intrinsic value of an option is:

• A) the same as the option premium.
• B) the amount the option is actually worth if it is immediately exercised.
• C) the amount the option is likely to be worth on its expiration date.
• D) impossible to determine given the lack of information on the future prices of the underlying asset.

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Definitions:

Authentic Interactions

Genuine and sincere exchanges or engagements between individuals, characterized by honesty and a true representation of oneself.

Responding

The act of replying or reacting to something.

Speaker

An individual who conveys information or expresses ideas through verbal communication in various settings.

Positive Reinforcement

A method in behavior theory where the introduction of a rewarding stimulus following a desired behavior increases the likelihood of it happening again.