A call option has an exercise price of $60.When the option expires,the price of the stock is exactly $60.What is the value of your call option?
A) $1
B) −$1
C) Zero
D) $60

Question

Quizplus · Accepted Answer

The value of a call option is calculated by taking the difference between the stock price and the exercise price. In this case, since the stock price is exactly equal to the exercise price, the difference is zero. Therefore, the value of the call option is also zero.

A Call Option Has an Exercise Price of $60