You own a call option with a strike price of $40 and a stock market price of $46. The intrinsic value of the call is
A) $ 6
B) $40.
C) $46.
D) -$6.
E)$ 0.

Name: You own a call option with a strike price of $40 and a stock market price of $46. The intrinsic value of the call is A) $ 6 B) $40. C) $46. D) -$6. E)$ 0.
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Question

You own a call option with a strike price of $40 and a stock market price of $46. The intrinsic value of the call is
A) $ 6
B) $40.
C) $46.
D) -$6. 
E)$ 0.

Quizplus · Accepted Answer

The intrinsic value of a call option is calculated as the current stock price minus the strike price, which in this case is $46 - $40 = $6.

You Own a Call Option with a Strike Price of $40