The intrinsic value of an option is the value if it were exercised
A) immediately
B) only at the expiration date
C) out-of-the money
D) in-the-money

Question

Quizplus · Accepted Answer

The intrinsic value of an option is the difference between the strike price and the current price of the underlying asset. If the option is in-the-money, the intrinsic value is positive. If the option is out-of-the-money, the intrinsic value is zero. The intrinsic value of an option is the value if it were exercised immediately.

The Intrinsic Value of an Option Is the Value If