A Call option with Exercise Price, 100 is priced at 6p when the spot price of the underlying is 96p. What are the Intrinsic, IV and Time values, TV respectively? A. IV = -4p, TV = 8p B. IV = -4p, TV = 6p = C. IV 0p, TV = 8p = D. IV. 0p, TV = 6p.
A Call option with Exercise Price, 100 is priced at 6p when the spot price of the underlying is 96p. What are the Intrinsic, IV and Time values, TV respectively? A. IV = -4p, TV = 8p B. IV = -4p, TV = 6p = C. IV 0p, TV = 8p = D. IV. 0p, TV = 6p.
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Can you please help with the question in the picture attached? The answer should be only one and I’m quite confused. Thank you!
![A Call option with Exercise Price, 100 is priced at 6p when
the spot price of the underlying is 96p.
What are the Intrinsic, IV and Time values, TV respectively?
A. IV = -4p, TV = 8p
B. IV = -4p, TV = 6p
=
C. IV 0p, TV = 8p
=
D. IV. 0p, TV = 6p.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F50190620-c34a-4e8b-9fa4-bbee30f322af%2F16bae10d-6d31-437b-804c-fd7031e53be2%2Flf1tqoi_processed.png&w=3840&q=75)
Transcribed Image Text:A Call option with Exercise Price, 100 is priced at 6p when
the spot price of the underlying is 96p.
What are the Intrinsic, IV and Time values, TV respectively?
A. IV = -4p, TV = 8p
B. IV = -4p, TV = 6p
=
C. IV 0p, TV = 8p
=
D. IV. 0p, TV = 6p.
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