The intrinsic value of an at-the-money call option is equal to
A)the call premium.
B)zero.
C)the stock price plus the exercise price.
D)the striking price.
E)none of the above.

Question

Quizplus · Accepted Answer

The intrinsic value of an option is the difference between the current stock price and the strike price of the option. Since an at-the-money call option has a strike price equal to the current stock price, its intrinsic value is zero. Therefore, the correct answer is B.

The Intrinsic Value of an At-The-Money Call Option Is Equal