Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Puts and Calls.
1. John (a speculator; he doesn’t own the stock) has purchased a put option with an exercise price of $56 for a premium of $10. A few days later, John buys the stock at $44 per share and he also exercises the option. Determine John’s net dollar gain per share. Check figure: Net gain or loss = $56 - $44 - $10 = $2 gain. Remember: Put option is the right to sell; call option is the right to buy.
2. Beth (a hedger; she owns the stock) has previously purchased stock in a company at $53 per share. Call options at a $50 exercise price presently have a $4 premium per share. Beth sells/writes a call option to Joe (he buys the option from Beth) on the stock that she owns. If the call option is exercised by Joe when the price of the stock is $58, what is the net gain or loss per share to Beth?
How can rational investors reduce their risk of investing in "stand alone" stocks? How does a stock portfolio reduce the risk of investments? What is a stock's beta? What is the Efficient Markets Hypothesis?
An Italian company is considering expanding the sales of its cappuccino machines to the U.S market. As a result, the idea of a setting up a manufacturing facility in the U.S should be explored. Why APV model is better than NPV model for capital budge..
Consider a taxable bond with a yield of 11% and a tax exempt municipal bond with a yield of 6.2%. At what tax rate would you be indifferent between the two bonds?
A firm is expected to pay a dividend of $2.85 next year and $3.00 the following year. Financial analysts believe the stock will be at their price target of $55 in two years. Compute the value of this stock with a required return of 12.8 percent.
Athos Twins has sales of $93,600. What is the net income of the company?
The assets of Crane Industries consist of current assets and net plant and equipment. The company has total assets of $3.5M and net plant and equipment equals $2.25M. The firm only finances with debt and common equity. What is the balance of current ..
The P Company applies overhead costs to jobs using machine hours as the allocation base. At the beginning of the year, 2014, the company estimated manufacturing overhead costs to be $1,400,000 and estimated total machine hours (the expected volume) t..
The dividend is expected to grow at a constant rate of 5% a year. The required rate of return on the stock, rs, is 13%. What is the stock's current value per sh
Your firm is considering two one-year loan options for a $478,000 loan. The first carries fees of 2.5% of the loan amount and charges interest of 3.9% of the loan amount. The other carries fees of 1.7% of the loan amount and charges interest of 4.4% ..
Suppose that you noticed the following prices: P=$48; S=$4; X=$50, for a one year European put option. The simple risk-free interest rate is 10% per year. Is there an arbitrage profit opportunity here? Yes or no?
Your wellness clinic wants to develop a product cost for the following activities using labor expense and supply expense to assign direct cost and visit minutes as a cost driver to assign indirect costs. Activity - Projected volumes - Labor expense (..
What is Peg's capital gain on this investment?
Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!
whatsapp: +1-415-670-9521
Phone: +1-415-670-9521
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd