How does the economy affect citizens?.

The theory of ______ states that the prices of tradable goods, when expressed in a common currency, will tend to equalize across

IgorLugansk [536]

The answer is; Purchasing Power Parity.

Hope this helped! :)

3 0

3 years ago

a trader creates a long butterfly spread from options with strike prices x, y, and z, where x < y < z, and y is exactly mi

Montano1993 [528]

Answer:

$1006

Explanation:

A long butterfly is created by following these steps

Long 1 call option for strike X ( highest premium say C)

Short 2 call option for Strike Y (premium =C-6.67 )

Long 1 call option for strike Z (premium = C-6.67 - 5.03 = C-11.70 where X<Y<Z

Here, Y-X = Z-Y =$11.70

i) whenever the price at maturity goes below the price of x ( no call option is executed )

payoff = 2*(C-6.67) -C-(C-11.7) = - 13.34 + 11.70 = - 1.64

ii) when the price at maturity is between X and Y, only call with strike X is executed

hence payoff = -1.64 +(P-X) where P is the Price at maturity

p - x = y-x = 11.70

hence maximum payoff = - 1.64 + 11.70 = $10.06

iii) When the price is between Y and Z , only call with strike X and Y are executed.

hence, payoff = -1.64 + (P-X) -2* (P-Y) = -1.64 +( 2Y - X - P) and this value decreases as P increases

the minimum payoff occurs when P=Z

So, maximum payoff = -1.64 + (Z-X) - 2*(Z-Y) = -1.64 + 23.4 - 2*11.7 = -$1.64

iv) When the price at maturity is more than Z , all calls are executed

hence, payoff = -1.64 +(P-X) -2* (P-Y) + (P-Z) = -1.64+(2Y-X-Z)

= -1.64+(Y-X -(Z-Y)) = -1.64+(11.7 - 11.70)

= -$1.64

the maximum payoff occurs when P=Y

considering the four options traded the maximum payoff = $10.06

Finally determine the maximum net gain when 400 options are traded

= 10.06 * 400 / 4

= 10.06 * 100 = $1006

3 0

3 years ago

The city of Ann Arbor Michigan buys a police car manufactured in Germany. In the GDP accounts this transaction is included in a.

natima [27]

Answer:

A. In government expenditures and imports.

Explanation:

We are informed about how The city of Ann Arbor Michigan buys a police car manufactured in Germany.

In the case of this transaction, it is included in GDP accounts in government expenditures and imports.

GDP which is known as Gross Domestic Product can be explained as the total market value of domestic finished goods/service that are been produced in a particular period in a country. The net export, as well as consumption and government expenditures and investment are taking into consideration in GDP. It should be noted that social security payment is not accounted with GDP

8 0

3 years ago

The Waking Dead Co provides services for both cash and on account The accounts are adjusted monthly, For September, the folowing

ivanzaharov [21]

Answer:

$25,000

Explanation:

Given that,

Accounts receivable:

Beginning balance 1 September = $22,400

Services on account = $45,000

Cash collected = $34,400

Written off accounts = $2,000

Allowance For Doubtful accounts:

Beginning balance 1 September = $4,400

Adjusted balance for Accounts receivables on 30 Sept ember:

= Beginning balance 1 September + Services on account - Cash collected - Written off accounts

= $22,400 + $45,000 - $34,400 - $2,000

= $31,000

Adjusted balance for Allowance For Doubtful accounts on 30 Sept ember:

= Beginning balance 1 September - Written off accounts + Bad Debt Expense

= $4,400 - $2,000 + ($45,000 × 8%)

= $4,400 - $2,000 + $3,600

= $6,000

Therefore, the September 30th net realizable value of Accounts Receivable is calculated as follows:

= Accounts receivables – Allowance for Doubtful accounts

= $31,000 - $6,000

= $25,000

3 0

3 years ago

A company purchased factory equipment on April 1, 2022 for $128,000. It is esti salvage value at the end of its 10-year useful l

just olya [345]

Answer:

Depreciation expense= $9,600

Explanation:

Giving the following information:

A company purchased factory equipment on April 1, 2022 for $128,000. 10-year useful life.

We weren't provided with the salvage value.

First, we need to calculate the annual depreciation:

Annual depreciation= (original cost - salvage value)/estimated life (years)

Annual depreciation= 128,000/10= 12,800

Now, for 9 months:

Depreciation expense= (12,800/12)*9= $9,600

8 0

3 years ago