The Intrinsic Value of an Option

question 50

Multiple Choice

The intrinsic value of an option

• A)is equal to the option premium.
• B)is the amount the option actually is worth if it is immediately exercised.
• C)is the amount the option is expected to be worth on its expiration date.
• D)is impossible to determine in the absence of information on the future prices of the underlying asset.

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Definitions:

Probable Appendicitis

A medical condition characterized by the likely inflammation of the appendix, requiring urgent evaluation.

Perforation

A hole that develops through the wall of a body organ or tissue, which can lead to the contents leaking into other parts of the body.

Sudden Relief

The immediate alleviation or disappearance of symptoms or discomfort.

Cleft Palate

A congenital deformity of the roof of the mouth that results in a split or opening in the palate.