Last Week,you Purchased a Call Option on Denver,Inc

question 48

Multiple Choice

Last week,you purchased a call option on Denver,Inc. stock at an option price of $1.05. The stock price last week was $28.10. The strike price is $27.50. What is the intrinsic value per share if Denver,Inc. stock is currently priced at $29.03?

• A) -$1.05
• B) $0
• C) $.48
• D) $.93
• E) $1.53

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Definitions:

Cognitive Operations

Mental processes that involve the manipulation and transformation of information in problem solving and decision making.

Field-Independent

A cognitive style where individuals tend to be more analytical, succeeding in tasks that require breaking down a larger picture into its component parts without being influenced by the context.

Embedded Figures

Involves finding a simple shape or figure hidden within a complex background, testing perceptual organization and the ability to distinguish foreground from background.

External Referents

Refers to objects, events, or entities outside of a person's mind that are referred to by linguistic expressions or symbols.