A put option on Intel stock with an expiration date of January 20, 2023 has a strike price of $55. The current stock price of Intel is $53. The option premium is $5. If I sell this option today, which of the following statements is true? O I receive $5 from the option buyer today.

EBK CONTEMPORARY FINANCIAL MANAGEMENT
14th Edition
ISBN:9781337514835
Author:MOYER
Publisher:MOYER
Chapter20: Financing With Derivatives
Section: Chapter Questions
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A put option on Intel stock with an expiration date of January 20, 2023 has a strike
price of $55. The current stock price of Intel is $53. The option premium is $5. If I
sell this option today, which of the following statements is true?
O I receive $5 from the option buyer today.
I purchase 1 Intel share at a price of $53 today.
OI sell 1 Intel share at a price of $53 today.
I purchase 1 Intel share at a price of $55 today.
Transcribed Image Text:A put option on Intel stock with an expiration date of January 20, 2023 has a strike price of $55. The current stock price of Intel is $53. The option premium is $5. If I sell this option today, which of the following statements is true? O I receive $5 from the option buyer today. I purchase 1 Intel share at a price of $53 today. OI sell 1 Intel share at a price of $53 today. I purchase 1 Intel share at a price of $55 today.
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