Answer: $717.60.

## Explanation For a call option at expiration: **Value of call at expiration = Max(0, Stock Price - Strike Price)** Given: - Call premium paid = $24.70 (this is not relevant for the expiration value calculation) - Strike price = $670 - Value at expiration = $47.60 We need to find the underlying price (S) at expiration: $47.60 = Max(0, S - $670) Since the call has positive value ($47.60 > 0), the option is in-the-money, so: $47.60 = S - $670 Solving for S: S = $670 + $47.60 = $717.60 Therefore, the underlying price at expiration is $717.60. **Why other options are incorrect:** - **A. $622.40**: This would be below the strike price ($670), making the call worthless (value = $0), not $47.60 - **B. $692.90**: This would give a call value of $692.90 - $670 = $22.90, not $47.60 **Key Concept**: At expiration, a call option's value equals the maximum of zero or the difference between the underlying asset price and the strike price. The premium paid initially is a sunk cost and doesn't affect the expiration value calculation.

Author: LeetQuiz .