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Agata [3.3K]
4 years ago
12

Suppose that you enter into a short futures contract to sell July silver for $17.20 per ounce. The size of the contract is 5,000

ounces. The initial margin is $4,000, and the maintenance margin is $3,000. What change in the futures price will lead to a margin call? What happens if you do not meet the margin call?
Business
1 answer:
ivanzaharov [21]4 years ago
7 0

Answer:

$0.20

Explanation:

For computing the change in future price, first we have to determine the loss which is shown below:

Loss = Initial Margin - Maintenance Margin

        = $4,000 - $3,000

        = $1,000

Now the change in future price would be

= Loss ÷ size of the contract

= $1,000 ÷ 5,000 ounces

= $0.20

The future price is increased by $0.20

And, if the margin call is not meet than the broker will stop at best price so that he cannot suffer more loss

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The Caesar Park Hotel generally caters to business customers during the week, so weekends are relatively quiet. The hotel has de
V125BC [204]

Answer:

It is trying to cultivate non peak demand. (B)

Explanation:

Non Peak demand are Minimum demand, hence in the case of Ceasar Park Hotel, they decided to promote mini vacation weekends for non business customers as a way of increasing the demand of their services during the weekends.

The Ceasar Park Hotel, observed that the weekends are relatively quiet, thus, they introduced 'the mini vacation weekends', as a way of 'cultivating non peak demand'.

7 0
3 years ago
Vincent and Jean are two cooks who work in a village. Each of them can either bake cakes or make pizzas. Every ingredient is rea
sveta [45]

Answer:

(A) Jean has absolute advantage in baking cakes 12 to 10

(B) Vincent comparative advantage in baking pizza as his opportunity cost is lower: 0.5

(C) Jean absolute advantage in making pizza: 8 to 5

(D) Jean comparative advantage in making pizza

Explanation:

(A) jean bakes 12 cakes per hour while Vincent bakes 10

(B) it willl be the pizzas it renounce to do for baking:

Vincent: 5/10 = 0.5 opportunity cost for baking: make 0.5 pizzas

Jean 8/12 = 2/3 = 0.66 opportunity cost for baking: makie 0.66 pizza

(C) Jean makes 8 pizzas while Vincent does 5

(D) As Vincent has a lower opportunity cost for baking, it will have a higher opportunity cost for making pizzas. Thus, Jean will be comparative advantage

5 0
3 years ago
Which of the following ratios measures how effectively a firm is managing its assets?a. quick ratiob. times interest earnedc. pr
lana [24]

Answer:

the answer is the Inventory turnover ratio hope this helps

Explanation:

7 0
4 years ago
Boxer Company owned 24,000 shares of King Company that were purchased in 2019 for $350,000. On May 1, 2021, Boxer declared a pro
ivolga24 [154]

Answer:

$92,000

Explanation:

Calculation for By how much is retained earnings reduced by the property dividend

Using this formula

Reduction in Retained earnings=(Boxer stock outstanding/Declared property dividend )×King stock market price)

Let plug in the formula

Reduction in Retained earnings=(46,000/10 shares ) x $20

Reduction in Retained earnings= $92,000

Therefore By how much is retained earnings reduced by the property dividend is $92,000

7 0
3 years ago
If the Fed was worried about overheating (GDP growing too fast, inflationary pressures building), then the appropriate open mark
oksano4ka [1.4K]

Answer:

The answer is false

Explanation:

Open market operations is a situation in which the Federal purchases and sells U.S. Treasury securities on the open market in order to regulate the supply of money in the economy.

If the Fed purchases securities in the open market, this increases the money supply in the economy. This is done when the economy is having low activities i.e economic hardship. Interest rate will be and if the Fed sells securities in the open market, it reduces the supply of money in the economy. This is done when the economy is overheating.

8 0
4 years ago
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