Smith Enterprises Stock Currently Sells for $17

question 37

Multiple Choice

Smith Enterprises stock currently sells for $17.50.A call option on the stock has a strike price of $20 and currently sells at $4.50.What is the intrinsic value of the option?

• A) $0
• B) $2.50
• C) $2.00
• D) $4.50

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Definitions:

Optimal Amount

The quantity of a good or service that achieves the best outcome under given conditions, such as maximizing profit or utility.

Research And Development

The investigative activities that a business or government entity undertakes with the intention of making a discovery that can either lead to the development of new products or procedures, or to the improvement of existing products or procedures.

Legal Protections

Laws and regulations designed to safeguard rights, ensure fairness, and protect individuals and entities from harm or exploitation.

Innovation

The process of creating new ideas, products, or methods, often leading to technological advancement or improved solutions.