The current market price of a share of Boeing stock is $75.If a put option on this stock has a strike price of $70, the put
A)is out of the money.
B)is in the money.
C)sells for a higher price than if the market price of Boeing stock is $70.
D)is out of the money and sells for a higher price than if the market price of Boeing stock is $70.

Question

Quizplus · Accepted Answer

A put option is "out of the money" when the strike price is below the current market price of the stock. In this case, the strike price is $70, and the market price is $75, so the put option is out of the money.

The Current Market Price of a Share of Boeing Stock