A put option on Dr. Pepper Snapple Group, Inc., has an exercise price of $45. The current stock price is $41. The put option is ________.
A) at the money
B) in the money
C) out of the money
D) knocked out

Question

Quizplus · Accepted Answer

A put option is considered "in the money" when the exercise price is above the current stock price, allowing the holder to sell the stock at a price higher than the current market price. Since the exercise price ($45) is above the current stock price ($41), the put option is in the money.

A Put Option on Dr