why an option’s time value is greatest when the stock price is near the exercise price and why it nearly disappears when the option is deep-in- or out-of-the-money

why an option’s time value is greatest when the stock price is near the exercise price and why it nearly disappears when the option is deep-in- or out-of-the-money

Explain why an option’s time value is greatest when the stock price is near the exercise price and why it nearly disappears when the option is deep-in- or out-of-the-money ? Critique the following statement, made by an options investor: “My call option is very deepin-the-money. I don’t see how it can go any higher. I think I should exercise it.”