Intrinsic value and time value of the option, Finance Basics

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Intrinsic value and time value of the option

An European put option with strike of $100 and maturity of 1 year has a value of $15. The forward price of the security at the same maturity is at $90.

(a) Based on the forward price, is this put option in the money, out of the money or at the money?

(b) What are the intrinsic value and time value of the option?

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Finance Basics: Intrinsic value and time value of the option

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Finance Basics: Intrinsic value and time value of the option

Reference No:- TGS052079

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Recent Questions Asked Finance Basics

Q : Person that cheat on there taxes

Q : Roles of accountants-auditors

Q : Determining the current share price of marcel

Q : Prepare a journal entry with a straight line method

Q : Intrinsic value and time value of the option

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Q : What cost information would be relevant to a decision

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Request for Solution File

Ask an Expert for Answer!!

Finance Basics: Intrinsic value and time value of the option

Reference No:- TGS052079

Recent Questions Asked Finance Basics

Q : Person that cheat on there taxes

Q : Roles of accountants-auditors

Q : Determining the current share price of marcel

Q : Prepare a journal entry with a straight line method

Q : Intrinsic value and time value of the option

Q : Annotated bibliography

Q : What cost information would be relevant to a decision

Q : Evaluate the effectiveness of company disaster recovery plan

Q : Three theories we have covered

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