A put option on a stock is said to be in the money if
A) the exercise price is higher than the stock price.
B) the exercise price is less than the stock price.
C) the exercise price is equal to the stock price.
D) the price of the put is higher than the price of the call.
E) the price of the call is higher than the price of the put.

Question

Quizplus · Accepted Answer

A put option is considered in the money when the exercise price (strike price) is higher than the current market price of the stock. This means the option holder can sell the stock at a higher price than the current market price, potentially making a profit.

A Put Option on a Stock Is Said to Be