Before expiration, the time value of an in-the-money put option is always:_______
a. equal to the stock price minus the exercise price.
b. positive.
c. negative.
d. equal to zero.

Respuesta :

Option B (positive) is the correct answer

Time Value of Money

The time value of money refers to the concept that money obtained now is worth more than money received later due to the earning power of the money. The temporal value of an option is the difference between the option's real price and its intrinsic value. Before expiration, the time value of money is always positive.

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