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What is the major difference in the obligation of one with a long position in a futures (or forward) contract in comparison to an options contract?Answer: A futures or forward contract is a vehicle for selling or buying a stated amount of foreign exchange at a stated price per unit at a fixed time in the future. Determine that if the long holds the contract to the delivery date, he pays the effectual contractual futures (or forward) price, consider whether it is an advantageous price in comparison to the spot price at the delivery date. By difference, an option is a contract providing the long the right to buy or sell a fixed quantity of an asset at a specified price at some time in the future, although not enforcing any obligation on him if the spot price is much more favorable as compared to the exercise price. Since the option owner does not have to exercise the option if it is to his disadvantage, the option has a price, or premium, while no price is paid at inception to enter into a futures (or forward) contract.
Policy Conflicts in Debt and Monetary Management: Co-ordination of operations is important so as to avoid differences in the policies of cash and debt management of the governm
Value Index Numbers The value index number as described earlier is a combination index which combines price and quantity changes. Because of the difficulties experienced in pri
How to finance the exit of the financiers The company would have to decide how to finance the exit of the financiers. Considerations comprise: (i) Selling shares to the pub
how to estimated
It is argued that VC & PE houses achieve superior returns through ruthlessly focussing management on short to medium term outcomes. In particular, parsimonious cash management is g
Demand and Supply Shocks The influence of the above macroeconomic factors on the economic performance can be analyzed by classifying their impact on the economy as a supply or
Assume a bank charges a 15.5% APR (annual percentage rate) on credit card holder compounds quarterly. What EAR (effective annual rate) is the bank is charging? What if they change
aggressive policy
What is the market risk premium in Spain at the present moment - the number which I have to use in the valuations? It is not possible to talk of "the" market premium for Spain.
Determine The key factor affecting financing Costs Because cost of capital is measured under the assumption that both firm's asset structure and its capital (financial) structu
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