Answer:
$5,346.98
Explanation:
Initial cash flow = 76,000
Discount rate = 5%
Suppose the C.F. in the 7th year is x which will flow till perpetuity
Present value of annual cash flow till perpetuity = Annual cash flow / Discount rate
PV at the 7th year = x/0.05
Discount factor = (1 + r)^n
Discount rate = 5%
Years D. factor Cash flows
0 0 76,000
1 0.952381 -
2 0.907029 -
3 0.863838 -
4 0.822702 -
5 0.783526 -
6 0.746215 -
7 0.710681 x/0.05
So, 76000 = 0.710681 *(x/0.05)
76000 / 0.710681 = x / 0.05
x = 76000 / 0.710681 * 0.05
x = 5346.98408990813
x = 5346.98
Hence, if the interest rate is 5%, $5346.98 will be received annually from the 7th year
Answer:
Consider the following explanation.
Explanation:
The six different strategies (spreads or combinations) the investor can follow:
1)short Butterfly spread: it’s a spread with selling one call option with the lowest strike price(XL),purchasing two call options with the medium strike price(XM) and selling one call option with the highest strike price (XH) , XL<XM<XH. The strike price (XM) is generally chosen such that its equal to the stock price and options are of same maturity. The strategy shall generate the net income from the selling of calls when the stock price deviated from the strike price XM due to the high volatility. A high jump either way guarantees a net income.
2) The Straddle combination with long one put and long 1 call with the same strike price X and maturity. Its payoff depends on the deviation of the strike price if the big jump either way is expected then either the put or the call expires in the money so that the moneyness(payoffs) covers all the premiums paid for the call and put and there are profits. The high jump either way guarantees a big payoff from either the put or the call.
3)In the Strangle combination there is one long call with strike price (Xc) and one long put with strike price Xp,this combination is cheaper to generate due to purchase of OTM(out of the money) options. If the big jump either way is expected then either the put or the call expires in the money so that the moneyness (payoffs) covers all the premiums paid for the call and put and there are profits. The high jump either way guarantees a big payoff from either the put or the call. It’s easier to cover all the lesser premiums paid for the call and put and generate profits with a big move.
4) The Strip combination consists of 1 call+2 put with same exercise price and maturity. If the big jump either way is expected then either the two put or the call expires in the money so that the moneyness covers all the premiums paid for the call and put and there are profits. The payoff generated by the 2 puts is much more when the stock moves downwards as compared to when the stock moves upwards. Investor is sure of the uncertain directional big jump but thinks that the probability of downward move is greater than the upward move.
5) The Strap combination consists of 2 calls+1 put with same exercise price and maturity. If the big jump either way is expected then either the 1 put or the 2 calls expires in the money so that the moneyness covers all the premiums paid for the call and put and there are profits. The payoff generated by the 2 calls is much more when the stock moves upwards as compared to when the stock moves downwards. Investor is sure of the uncertain directional big jump but thinks that the probability of upward move is greater than the downward move.
6) Short Calendar spread: short shorter term call and at the same time short longer term call therefore the income is generated by the big move from the premiums of the calls and differences in the maturity.
Answer:
Cost of goods sold = $179,000
Explanation:
The cost of goods sold represent the amount of direct expenditure incurred on the units of goods sold for the period. It is computed as follows
Cost of goods sold = Opening inventory + cost of production - closing inventory
Note that closing inventory represents the value of the goods yet to be sold at the end o the period while opening inventory represent the worth of goods brought forward from the previous period.
Cost of production is the addition of direct material, direct labour and production overhead.
The cost of goods sold for unique production is
Cost of goods sold = Opening inventory + production - closing inventory
cost of gods sold = 20,000 + (60,000 + 35,000 + 100,000) - 36,000
= $179,000
In economics, decisions are necessary because resources are scarce, while wants and needs are practically unlimited.
<h3>What is economic?</h3>
Economics examines how products and services are produced, distributed, and consumed as well as the decisions that people, corporations, communities, and countries make when distributing funds.
There are enormous people who are living in this world and all of them have some kind of need or want them to need to fulfill and also which means that there will be limited resources that will be available to them in the near future also.
Learn more about economics, here:
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Answer: exemplify you are well rounded
Explanation:
Items listed in the interests/activities section of a résumé are used to exemplify you are well rounded.
The essence of listing your interests or hobbies is to show the recruiting officer that one is well rounded and fits the particular position.
This part of the resume also makes one stand out or unique from others and can be used to complement ones academic qualifications.
