What is a speculative premium

Assignment Help Financial Accounting

Reference no: EM13775161

1. What is a speculative premium?

a. The difference between a call and the intrinsic value

b. The difference between a warrant and a call

c. The difference between a put an a call

d. The difference between a warrant and its intrinsic value

2. The strike price of a contract specifies the price at which the securityarrow-10x10.pngarrow-10x10.png covered by an option may be bought or sold

True

False

3. A stock is selling for $42.50 with an option available at a $40 strike price. The 40 call option is price is at $6.50. What is the intrinsic value of the call?

a. -2.80

b. -5.60

c. 5.60

d. 2.80

4. Out of the money warrants are worth more than in the money warrants

True

False

Reference no: EM13775161

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