The intrinsic value of an in-the-money put option is equal to
A)the stock price minus the exercise price.
B)the put premium.
C)zero.
D)the exercise price minus the stock price.

Question

Quizplus · Accepted Answer

The intrinsic value of an in-the-money put option is calculated as the exercise price minus the stock price, because it represents the immediate exercise value of the option to the holder.

The Intrinsic Value of an In-The-Money Put Option Is Equal