The time value of a call option is equal

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Reference no: EM131612220

1. Before expiration, the time value of a call option is equal to

A) zero

B) the actual call price minus the intrinsic value of the call.

C) the present value of the intrinsic value of the call.

D) the actual call price of the call.

2. For each of the short-term marketable securities given here, provide an example of the potential disadvantages the investment has for meeting a corporation’s cash management goals.

U.S. Treasury bills

Ordinary preferred Stock

Negotiable certificates of deposit (NCDs)

Commercial paper

Reference no: EM131612220

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