Which of the following best defines intrinsic value?
A) The lower bound of an option's value, or what the option would be worth if it were about to expire.
B) A contract that gives its owner the right to buy or sell some asset at a fixed price on or before a given date.
C) The value of a convertible bond if it could not be converted into common stock.
D) The right to sell an asset at a fixed price during a particular period of time. The opposite of a call option.
E) An option with payoffs in real goods.
Correct Answer:
Verified
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