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An investor owns a call option on XYZ that expires in three months and has a strike price of $ 1 3 0 per share.
An investor owns a call option on XYZ that expires in three months and has a strike price of $ per share. The current price of XYZ stock is $ per share, and the current market price of the option is Which of the following actions should the investor take, and why?
A
Do not exercise the option, because the intrinsic value of the option $ is less than the strike price of the option $
B
Exercise the option, because the market value of the option $ is above zero.
C
Exercise the option, because the excess of the strike price over the market price would result in an immediate gain of $ per share.
D
Do not exercise the option, because the strike price exceeds the market price and the transaction would result in an immediate loss.
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