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An out-of-the-money put with strike 100 and spot 110 has intrinsic value equal to:
ARs 10
BRs 0
CRs −10
DRs 5
Answer & Solution
Correct answer: B. Rs 0
1. Identify what the question asks: this concept maps to putintrinsic (§6.4).
2. Apply the framework or formula relevant to the topic.
3. Eliminate distractors and arrive at the correct option (B).
_Source: ICAI BoS CA Final Paper 2, Ch 9 "Derivatives Analysis and Valuation"_
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