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I want to show you how you can use Excel to draw the payoff pictures for some options in this case Iamp;#39;m going to look at a call option as well as a put option being able to do this allows you to see the payoffs you can graph it and maybe get a better understanding of what a call option is so the intrinsic value for a call option A call option gives you the right to buy at the exercise price but not the obligation so if itamp;#39;s not beneficial to do so you can just throw it away so the intrinsic value that is the value of being able to exercise the option that is use it as um to be able to buy at X even though the price is s if s is greater than x the stock price is greater than the exercise price then it has value itamp;#39;s what we say is in the money that is you can buy at the exercise price and then sell it at that higher stock price and make a profit if itamp;#39;s out of the money that is the exercise price is above the stock price or the stock price is below the exe
