Question

If the spot price is higher than the strike price in a call option it is referred to as _________.

• A. At the money
• B. In the money
• C. Out of the money
• D. Premium

Answer 1

The correct option is B In the money

The strike. or exercise price, is the most important determinant of option value. Strike prices are established when a contract is first written. It tells the investor what price the underlying asset must reach before the option is in-the-money (ITM).