A call option whose exercise price is less than the spot price is said to be:
A) in-the-money.
B) at-the-money.
C) out-of-the-money.
D) under-the-spot.

Question

Quizplus · Accepted Answer

A call option is considered in-the-money when the exercise price is lower than the current market price of the underlying asset. This means that the owner of the call option has the right to buy the asset at a lower price than its current value, which is advantageous.

A Call Option Whose Exercise Price Is Less Than the Spot