Series 7 - General Securities Representative Exam

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An option's premium is 16.00. It's intrinsic value is 12.00. What is the time value?

28.00
A
12.00
B
4.00
C
Not enough data
D

Explanations

4.00. Premium (P) = intrinsic value (I) + time value (T). Time value is Extrinsic Value

Pricing