Which of options above has lowest time value

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Reference no: EM1371146

Q. You are provided following data on call and put premia in cents per share for company ABC's shares, currently priced at 425 cents each. Each contract refers to 1000 shares.

Call Premia Call Premia Call Premia

Put Premia Put Premia Put Premia

Strike Prices April June September

April June September
420 22 31 34 14 20 27
460 6 12 15 39 42 48

(a) List all call and put premia that are `out of money'.

(b) Explain your intuition as to why premia rise between April and September.

Reference no: EM1371146

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