Assume we have a stock currently worth $100.We also assume the interest rate is zero, and we can buy options for this stock with a strike price of $100.If the stock can rise or fall by $5 with equal probability over the option period, and the option cannot be exercised until the expiration date, what is the time value of the option?
A)$10
B)$5
C)$0
D)None of the above answers is correct.

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The Answer of Assume we have a stock currently worth $100.We also assume the interest rate is zero, and we can buy options for this stock with a strike price of $100.If the stock can rise or fall by $5 with equal probability over the option period, and the option cannot be exercised until the expiration date, what is the time value of the option?
A)$10
B)$5
C)$0
D)None of the above answers is correct.

Assume We Have a Stock Currently Worth $100