The exercise price on an option :
A) changes as the price of the underlying stock increases or decreases.
B) has a series of standardized strike prices.
C) is not adjusted for stock splits.
D) is also known as the option premium.

Question

Quizplus · Accepted Answer

The exercise price, or strike price, on an option has a series of standardized strike prices. This means that for any given stock, there are specific, predetermined prices at which options can be exercised. These prices do not change with the market price of the stock, are adjusted for stock splits, and are distinct from the option premium, which is the price paid for the option itself.

The Exercise Price on an Option