What is the intrinsic value of a call with a strike price of $40 a market price of $44? The call's ask price $540.
A)-$400
B)-$140
C)$940
D)$400

Question

Quizplus · Accepted Answer

The intrinsic value of a call option is calculated as the market price of the underlying asset minus the strike price. In this case, $44 - $40 = $4. Since options are typically quoted in terms of 100 shares, the intrinsic value is $4 * 100 = $400.

What Is the Intrinsic Value of a Call with a Strike