ABC, which closed at $151, has call options trading in April, July, and October with the following values:

(a) Calculate the intrinsic value of the April 150 call.
(b) Calculate the intrinsic value of the April 140 call.
(c) Should the price of ABC rise to $156, what is the minimum value that the April 150 call should trade at?

Question

ABC, which closed at $151, has call options trading in April, July, and October with the following values:
  
(a) Calculate the intrinsic value of the April 150 call.
(b) Calculate the intrinsic value of the April 140 call.
(c) Should the price of ABC rise to $156, what is the minimum value that the April 150 call should trade at?

Quizplus · Accepted Answer

The Answer of ABC, which closed at $151, has call options trading in April, July, and October with the following values:
  
(a) Calculate the intrinsic value of the April 150 call.
(b) Calculate the intrinsic value of the April 140 call.
(c) Should the price of ABC rise to $156, what is the minimum value that the April 150 call should trade at?

ABC, Which Closed at $151, Has Call Options Trading in April