The current market price of a share of a stock is $80. If a put option on this stock has a strike price of $75, the put
A) is in the money.
B) is out of the money.
C) sells for a lower price than if the market price of the stock is $75.
D) is in the money and sells for a lower price than if the market price of the stock is $75.
E) is out of the money and sells for a lower price than if the market price of the stock is $75.

Question

Quizplus · Accepted Answer

If the striking price on a put option is less than the market price, the option is out of the money and sells for less than an at the money option.

The Current Market Price of a Share of a Stock