Series 7 - General Securities Representative Exam
OJJ stock is trading at 118.50. OJJ May 115 calls are trading at 11.00. What is the time value of the OJJ May 115 calls?
The time value is the extrinsic value of the calls. There is 3.50 of intrinsic value. The premium is 11.00. Premium minus intrinsic value is the time value