Intrinsic value
Question
Given the following information, calculate the intrinsic value of the call option on Ford’s
stock:
Current price of Ford’s stock: $15
Strike price of option on Ford’s stock (expires in 3 months): $12
Market price of 3-month option on Ford’s stock: $10
A) $2
B) $5
C) $3
D) $10
E) $1
19. Given the following information, calculate the stockholder’s return:
Beginning Price: $8
Ending Price: $10
Dividends Paid: $1
A) 22%
B) 25%
C) 13%
D) 38%
E) 10%