The time value of a call option is
I) the difference between the option's price and the value it would have if it were expiring immediately.
II) the same as the present value of the option's expected future cash flows.
III) the difference between the option's price and its expected future value.
IV) different from the usual time value of money concept.
A. I
B. I and II
C. II and III
D. II
E. I and IV
E. I and IV
The time value of an option is described by I and is different from the time value of money concept frequently used in finance.
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