When is a stock option said to be in-the-money?

Question

Quizplus · Accepted Answer

A stock option is said to be in-the-money when the current market price of the underlying stock is higher than the exercise price of the option. This means that if the holder of the option were to exercise it and buy the stock at the exercise price, they could immediately sell the stock in the market at a higher price and make a profit. When the exercise price is less than the market price of the shares, the option holder would be able to make a profit and the option is therefore in-the-money.

When Is a Stock Option Said to Be In-The-Money