Question: Hi, can you help me to answer this question, regarding options topic. An option has a time premium of 0.13. Its exercise price is RM5.50,

Hi, can you help me to answer this question, regarding options topic.

An option has a time premium of 0.13. Its exercise price is RM5.50, the underlying stock price is now RM5.80. What should the option's premium be if it were:

a)A call option

b)A put option

Why the premiums different?

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!