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A call option for a P5,000,000-face value bond has a strike price of 101. If the market value of the bonds is P5,300,0000, then the option would be? a.) out-the-money by 50,000 b.) in-the-money by 250,000 c.) out-the-money by 250,000 d.) in-the-money by 50,000

A call option for a P5,000,000-face value bond has a strike price of 101. If the market value of the bonds is P5,300,0000, then the option would be? a.) out-the-money by 50,000 b.) in-the-money by 250,000 c.) out-the-money by 250,000 d.) in-the-money by 50,000

Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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A call option for a P5,000,000-face value bond has a strike price of 101. If the market value of the bonds is P5,300,0000, then the option would be?

a.) out-the-money by 50,000

b.) in-the-money by 250,000

c.) out-the-money by 250,000

d.) in-the-money by 50,000

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