Which of the following best describe the exercise value of a call option?
A) The exercise value of a call option is the positive difference between the current price of the stock and the strike price. The exercise value is zero if the stock's price is below the strike price.
B) The exercise value of a call option is the positive difference between the current price of the stock and the strike price. The exercise value is greater than zero if the stock's price is below the strike price.
C) The exercise value of a call option is the positive difference between the current price of the stock and the strike price. The exercise value is negative if the stock's price is below the strike price.
D) The exercise value of a call option is the positive difference between the current price of the stock and the option price. The exercise value is zero if the stock's price is below the strike price.
Correct Answer:
Verified
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