The Following Quotes Were Observed for Options on a Given

question 35

Multiple Choice

The following quotes were observed for options on a given stock on November 1 of a given year. These are American calls except where indicated. Use the information to answer questions 7 through 20.

The stock price was 113.25. The risk-free rates were 7.30 percent (November) , 7.50 percent (December) and 7.62 percent (January) . The times to expiration were 0.0384 (November) , 0.1342 (December) , and 0.211 (January) . Assume no dividends unless indicated.
-What is the time value of the November 110 call?

• A)0.00
• B)4.40
• C)1.15
• D)3.25
• E)none of the above

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Definitions:

Threaten

To express an intention to inflict harm or loss on someone or something, typically to coerce action or behavior.

Disinhibition

The reduction of restraint or inhibition in social situations, often facilitated by anonymity or group dynamics.

Online Groups

Communities or collections of individuals who interact through digital platforms, sharing interests, goals, or purposes via the internet.

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Shared expectations and rules that guide behavior within a group or society, often unspoken and learned through social interaction.