Question
The strike price for an American option is $45, while the market price of the stock is $48. The option will expire in a couple
The strike price for an American option is $45, while the market price of the stock is $48. The option will expire in a couple of months. What can be said about the price (or "premium") of a call option and of a put option , respectively?
a. The call will be worth more than $0 and the put will be worth less than $3
b. The call will be worth more than $3 and the put will be worth more than $0
c. The call will be worth more than $0 and the put will be worth more than $3
d. The call will be worth more than $3 and the put will be worth $0
e. The call will be worth exactly $0 and the put will be worth more than $3
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