Consider a stock that is currently trading at $20. Calculate the intrinsic value for a put option that has an exercise price of $35.
A) $15
B) $55
C) $35
D) -$15
E) $0

Question

Quizplus · Accepted Answer

The intrinsic value of a put option is calculated as the exercise price minus the current stock price, provided this difference is positive. If it's negative, the intrinsic value is zero. Here, it's $35 - $20 = $15.

Consider a Stock That Is Currently Trading at $20