Question

The current market price of a share of Disney stock is $60. If a call option on this stock has a strike price of $65, the call can be exercised profitably. is out of the money and can be exercised profitably. is in the money. is out of the money. is in the money and can be exercised profitably.

Answer 1

Answer:

out of the money and cannot be exercised profitably.

Explanation:

In this question, we are asked to state the status of a call on a share of stock.

Now , We can identify that the strike price $65 has a greater value than market price of $60,

In situations when the striking price on a call option is more than the market price, the option is out of the money and cannot be exercised profitably.