SIE practice questioneasyIn/Out/At the money
A put option is described as 'in the money' when:
- AMarket price is below the strike price✓ Correct answer
- BMarket price is above the strike price
- CMarket price equals the strike price
- DOption is out of the money
Explanation
Why A — Market price is below the strike price
A put is in the money when the market price is below the strike price. Calls are in the money when the market is above the strike price.
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