A 45 Put Option on a Stock Priced at $50

question 3

Multiple Choice

A 45 put option on a stock priced at $50 is priced at $3.50.This call has an intrinsic value of ______ and a time value of _____.

• A) $3.50; $0
• B) $5.00; $3.50
• C) $3.50; $5.00
• D) $0; $3.50

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Definitions:

Manufacturing Flexibility

The ability of a manufacturing system to quickly adapt to changes in product type or volume without incurring high costs or delays.

Competitive Advantage

The unique feature or set of features of a company and its products that are perceived as superior in the market, contributing to greater sales or margins than competitors.

Assembly Lines

A manufacturing process in which parts are added to a product in a sequential manner, using conveyors or other efficient means, to create a finished product efficiently.

Robotics

The branch of technology that involves the design, construction, operation, and application of robots.