What is annual continuously compounded rate of interest

Assignment Help Financial Management
Reference no: EM131835111

1. A put option and a call option with an exercise price of $65 expire in three months and sell for $.92 and $5.50, respectively. If the stock is currently priced at $68.38, what is the annual continuously compounded rate of interest?

2. You will require $700 in 5 years. If you earn 5% interest on your funds, how much will you need to invest today in order to reach your savings goal? What are the calculations to get the answer on a financial calculator?

Reference no: EM131835111

Questions Cloud

How much will you have at your retirement : If the retirement account earns a fixed 5% annual interest, how much will you have at your retirement?
What real annual rate are they charging : Your credit card says it charges 14.9% APR with daily compounding. What real annual rate are they charging?
Calculate the market? index : calculate the market? index, using the same methodology used to calculate the? S&P indexes, at each of the 3 dates.
Guaranteed to make you risk-free immediate profit : Identify a portfolio that includes a long position in exactly 100 shares of stock in firm X and is guaranteed to make you a risk-free immediate profit.
What is annual continuously compounded rate of interest : If the stock is currently priced at $68.38, what is the annual continuously compounded rate of interest?
Annuity dues are constant and consistent payments : Annuity dues are constant and consistent payments that occur at the end of each investment period.
Creating global expansion of entrepreneurship : Describe some of the powerful economic forces that are creating global expansion of entrepreneurship.
What are the prices of call option and put option : What are the prices of a call option and a put option with the following characteristics?
Black light health management system : White Enterprises just invested in a black light health management system at a cost of $600,000.

Reviews

Write a Review

Financial Management Questions & Answers

  Nearest values in the cumulative normal distribution table

The price of HighTech (HT) stock is $534.25. Your broker tells you that you could buy a European call option on HT with a strike price of $750 and 325 days until maturity for $54. Your research indicates that the standard deviation of HT’s stock retu..

  Make in order to partake of future cybernetic goodness

You estimate that you will need $716 thousand in 30 years to buy some cybernetic body enhancements, including infrared vision, retractable claws, and expanded brain storage capacity. To achieve your financial goal, you want to make three equal-sized ..

  What is the accounting break-even quantity

A project has the following estimated data: price = $40 per unit; variable costs = $28 per unit; fixed costs = $14,500; required return = 8 percent; initial investment = $24,000; life = four years. Ignoring the effect of taxes, what is the accounting..

  Present value as the time to the future value increases

What happens to the present value as the time to the future value increases?

  Make economic sense for consumer to pass on offered discount

Which of the folowing situation does it NOT make economic sense for a consumer to pass on an offered discount?

  Two companies reveals identical levels of working capital

Your analysis of two companies reveals identical levels of working capital.

  What are operating and financial plans

How are target shareholders affected by a hostile takeover attempt? How are the bidder’s shareholders affected by a hostile takeover attempt? compare and contrast how dividends may increase the value of the firm and how dividends may increase the val..

  Does it take the firm to sell its inventory assuming

How many days, on average, does it take the firm to sell its inventory assuming that all sales are on credit?

  Company policy to always maintain constant growth rate

Suppose you know that a company’s stock currently sells for $56 per share and the required return on the stock is 10 percent. You also know that the total return on the stock is evenly divided between a capital gains yield and a dividend yield. If it..

  Mature company with profitable history

The stocks of some companies are purchased because of the company’s profitability. In the fashion world, Nordstrom is an example that comes to mind. What is your preference – do you prefer a mature company with a profitable history or would you prefe..

  What are the potential benefits of the aca

What are the potential benefits of the ACA - what is the potential negative impact of the ACA and what, if any, ethical considerations might there be for any of the three scenarios?

  Use to meet the liquidity needs of the estate

Describe a situation for which an executor must have immediate cash needs for an estate; use an example in the recent news to illustrate. Then, choose one of the three methods that an executor can use to meet the liquidity needs of the estate. Be spe..

Free Assignment Quote

Assured A++ Grade

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!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd