SIE practice questioneasyIntrinsic value
A call option with a $50 strike price and the underlying stock at $55 has what intrinsic value per share?
- A$0✓ Correct answer
- B$50
- C$5
- D$55
Explanation
Why A — $0
The intrinsic value of a call is the market price minus the strike price ($55 - $50 = $5). The other options miscalculate or misunderstand intrinsic value.
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