The strike price of an option is:
A) the market price at the time the option is written.
B) the market price at the time the option is exercised.
C) the price at which the option holder has the right to buy or sell.
D) always above the market price.

Question

Quizplus · Accepted Answer

The strike price of an option is the price at which the option holder has the right to buy or sell the underlying asset. It is set at the time the option is written and remains constant until expiration. It may be above or below the market price at the time of writing the option, and it can be different from the market price at the time of exercise.

The Strike Price of an Option Is