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Management · Q526

International Finance and Treasury

Graduate and Post Graduate · Management · question 526

Q526

If intrinsic value of an option is 450 and price of an option is 560 then time value of an option is

A.
$110
Answer
B.
$1,010
C.
$450.00
D.
$560

Answer: Option A

Solution

Answer: Option A
Solution:
Time value of an option = Price of an option - Intrinsic value of an option
= 450 = $110.
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