(Exercise value and time premium) American Express common stock is currently selling for $39. A call option expiring in 30 days with a strike price…

(Exercise value and time premium) American Express common stock is currently selling for $39.59. A call option expiring in 30 days with a strike price of $40 is selling for $0.85. A put option with the same strike price and expiration is selling for $1.20.

A.     What is the exercise value and the time premium of the call option?

Call exercise value=

Time premium=

B.     What is the exercise value and the time premium of the put option?

Put exercise value=

Time premium=

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