Option Premium = Intrinsic Value + Time Value. This is the standard formula used to calculate the premium of an option. The intrinsic value is the difference between the current price of the underlying asset and the strike price of the option. If the option is 'out of the money', meaning the strike price is unfavorable compared to the current price, the intrinsic value is zero. The time value, on the other hand, is the part of the premium that exceeds the intrinsic value. It represents the value of the option's remaining time until expiration. The longer the time until expiration, the higher the time value, as it provides the option holder with more opportunities to benefit from favorable price movements in the underlying asset. Therefore, the option premium is the sum of the intrinsic value and the time value.

Choice B is incorrect. The option premium cannot be calculated by subtracting the time value from the intrinsic value. This would imply that as the time until expiration increases, the option premium decreases, which contradicts the concept of options pricing where an increase in time to expiration generally increases the option's price due to increased uncertainty.

Choice C is incorrect. The equation for calculating an option premium does not involve subtracting intrinsic value from time value. This would suggest that a higher intrinsic value (i.e., a more in-the-money option) reduces the overall premium, which is not accurate as options with higher intrinsic values are typically more expensive.

Choice D is incorrect. The price of an underlying asset has no direct subtraction relationship with time value to determine an option's premium. In fact, it's quite opposite; both these factors contribute positively towards determining an options' price or premium.