Question: Intrinsic value is correct at $0. However, the time value entered here is incorrect. What is the time value? Abercrombie & Fitch is trading at

Intrinsic value is correct at $0. However, the time value entered

Intrinsic value is correct at $0. However, the time value entered here is incorrect. What is the time value?

Abercrombie \& Fitch is trading at $21.14. Put options with a strike price of $19.85 are priced at $0.87. What is the intrinsic value of the option, and what is the time value? The intrinsic value of the option is $. (Round to the nearest cent.) The time value of the option is $ (Round to the nearest cent.)

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!

What is the most likely hedge ratio for a call option that has a strike price of $50 while the underlying stock price is $30? Close to 1. Close to 0. Positive. Negative. The exercise price of a put...

8 Option Markets Problems. Answers are provided. Please use the formula sheet that is attached separately to answer questions. Please show all work. Formulas: Options (Fin. 338) 1. Black-Scholes...

what is the intrinsic value of the option? what is the time value? Abercrombie & Fitch is trading at $21.33. Put options with a strike price of $20.10 are priced at $0.93. What is the intrinsic value...

QUESTION 1 The price of an option is also referred to as Offset Strike price Exercise price Option premium None of the above QUESTION 2 In general, the following contracts are a type of options...

1 . ) Distinguish between business risk and financial risk. 2 . ) Distinguish between real assets and financial assets. 3 . ) Define arbitrage and the law of one price. 4 . ) What is an efficient...

DONT NEED EXPLAINATION JUST THE ANSWERS TO ALL PLEASE !!! 7). Assume a convertible bond with a $1,000 face value is convertible into 80 shares of common stock. Conversion price is $12.50. The market...

Please respond to discussion board 4 & 5 question that is shown after the discussion board rubric/requirements. Please do not copy/paste from sources. Write in own words and cite where it came from....

Below is the second article Question: After reading the above articles 1 and 2, who do you think is driving markets - short-term or long-term investors? DO Tundamentais or emotionsdrive the stock...

1. From the scenario, cite your forecasting conclusions that support TFC?s decision to expand to the West Coast market. Speculate as to whether or not the agency conflict discussed in the scenario...

I need a step by step solutions for the 10 problems in the excel file. The correct answers are provided I only need the solutions steps. Subject is Finance (options valuation) On March 2, a Treasury...

Read the article, Cheesecake Factory says its not paying rent If you are the management accountant at Cheesecake factory, which budget in the master budget would you need to adjust to implement the...

Within cells, small organelles containing newly synthesized proteins are transported along microtubules by tiny molecular motors called kinesins. What force does a kinesin molecule need to deliver in...

4 . What is the primary drawback with respect to the use of sampling? A . Individuals may fail to obtain a true understanding of the question they are examining B . The time spent in planning and...

Which of the following activities regularly conducted by a tax-exempt organization will result in unrelated business income? A. Selling items made by persons with disabilities as part of their...