How many of the December 2010 put options are in-the-money?
A)1
B)2
C)3
D)4
E)5

Question

Quizplus · Accepted Answer

To be in-the-money, the stock price must be below the strike price for put options. Looking at the table, the strike price of $115 has a stock price of $111.48, which is below the strike price and in-the-money. The strike price of $120 has a stock price of $110.13, which is also below the strike price and in-the-money. Therefore, there are 2 December 2010 put options that are in-the-money.

How Many of the December 2010 Put Options Are In-The-Money