An American-style call option with six months to maturity has a strike price of $35. The underlying stock now sells for $43. The call premium is $12. What is the time value of the call?
A) $8
B) $12
C) $0
D) $4
E) Cannot be determined without more information
Correct Answer:
Verified
Q46: Use the two-state put-option value in this
Q62: An American-style call option with six months
Q63: The intrinsic value of an at-the-money put
Q64: The time value of a put option
Q67: The intrinsic value of an in-of-the-money call
Q69: Options sellers who are delta-hedging would most
Q70: As the underlying stock's price increased, the
Q72: An American-style call option with six months
Q77: The hedge ratio of an option is
Q80: Since deltas change as stock values change,
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents