Compute the intrinsic value and time value, Financial Accounting

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Compute the intrinsic value and time value

Response to the following questions:

1. Cisco is selling for $19. Call options with an $18 exercise price are priced at $2.50. What 3 is the intrinsic value of the option, and what is the time value?

2. Gillette is trading at $31.11. Call options with a strike price of $35 are priced at $0.30. What is the intrinsic value of the option, and what is the time value?

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Financial Accounting: Compute the intrinsic value and time value

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