The intrinsic value of a Call option is

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The intrinsic value of a Call option is

A. Strike price - Underlying Price

B. Underlying price - Strike Price

C. Strike price > Underlying price

D. Strike price < Underlying price

Answer: Option B

Solution (By Examveda Team)

The intrinsic value of a Call option is Underlying price - Strike Price. The intrinsic value of both call and put options is the difference between the underlying stock's price and the strike price. In the case of both call and put options, if the calculated value is negative, the intrinsic value is zero.

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