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Mrrafil [7]
3 years ago
9

A customer purchases 1 XYZ July 50 call @ 5. The customer will breakeven at which of the following market prices for the underly

ing security?[A] 5[B] 45[C] 50[D] 55
Business
1 answer:
matrenka [14]3 years ago
5 0

Answer:

(D) 55

Explanation:

For the purchase of 1 XYZ July 50 call @ 5, the customer has already paid a call premium of $5 (indicated by the @5).

The exercise price of the call is $50, meaning the call option gives the customer the right to buy XYZ at $50.

Thus, the customer will break even when the market price of XYZ = the exercise price + the premium

= 50 + 5 = 55.

At that market price ($55), the customer would pay a total of $5 premium, plus an exercise price of $50, which equals $55 (same as the market price.

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On April 1, Construction Contractors, Inc., contracts to build a store for Discount Retail, Inc., at a specific location in Elec
mr Goodwill [35]

Answer:

c. the contract is discharged.

Explanation:

As the contract is not feasible to be completed not because of any parties of the contract, but because of externalities.

This provides for the no fault conditions on both the parties of the contract.

Here the construction was to be done by the Construction Contractors Inc. for Discount Retail Inc, at a place in Electro City.

But now the construction cannot happen as because Electro City has an amendment providing no construction at the particular place where Discount Retail Inc. wants the construction.

5 0
3 years ago
When evaluating financial planning steps, we must consider all of the following, except:
Yakvenalex [24]

Answer:  all the above steps are considered when evaluating financial planning except OPTION C how all small projects are added up for one big project.

Explanation:

financial is delicate aspect of any b business and company. financing a project companies need to follow some steps. the financial planning of a company of business must consider the following: i. the planning horizon which is the time frame of the planning process.

ii.  the project horizon which explain the feasibility time of the project.

iii.  identifying the total need of the investment. this explain the importance of the project at that particular time

iv.  sets of assumptions for various scenarios. this explain various alternative courses of action concerning the said project.

the above listed steps are the only considered steps. there are others such as identifying the current financial position of the company,reviewing and revising the plan,creating and implementation of the financial action and many more

8 0
3 years ago
Which depreciation method does not use an asset's residual value to calculate depreciation expense?
ira [324]

Declining-balance depreciation method does not use an asset's residual value to calculate depreciation expense.

<h3>What is depreciation?</h3>
  • In accountancy, depreciation refers to two aspects of the same concept: first, the actual decrease of fair value of an asset, such as the decrease in value of factory equipment each year as it is used and wear, and second, the allocation in accounting statements of the original cost of the assets to periods in which the assets are used.
  • Depreciation is thus the decrease in the value of assets and the method used to reallocate, or "write down" the cost of a tangible asset (such as equipment) over its useful life span.
<h3>What does accounting depreciation mean?</h3>
  • During the asset's anticipated useful life, depreciation is allocated in order to charge a fair percentage of the depreciable amount in each accounting period.
  • Amortization of assets with predetermined useful lives is included in depreciation.

Learn more about depreciation here:

brainly.com/question/15085226

#SPJ4

3 0
2 years ago
When each person specializes in producing the good in which he or she has a comparative advantage, total production in the econo
OLga [1]

Answer:

The correct answer is c) rises.

Explanation:

Each country in question will specialize in what is most efficient. At the same time, it will import the rest of the products in which they are most ineffective in terms of production. Although a country does not have an absolute advantage in producing any good, it may specialize in those goods in which it finds a greater comparative advantage and finally participate in the international market. In this sense, it can boost its foreign trade.

It is then the basic idea that countries choose to specialize in order to trade in activities where they have a certain advantage. That is, instead of producing what they do best in an absolute way, they produce what they do best in a relative way. Therefore, the difference with the theory of absolute advantage is that it does not produce what the country costs less, but the one with lower comparative costs.

7 0
3 years ago
7.You invested in long-term corporate bonds and earned 6.1 percent. During that same time period, large-company stocks returned
Marat540 [252]

Answer: 1.9%

Explanation:

The risk premium is the return that an investment offers over the risk free rate in the market.

The risk free rate is the return on the U.S. Treasury bill in the same period:

Average risk premium = Return on long term corporate bond - Return on U.S. T-bill

= 6.1% - 4.2%

= 1.9%

4 0
3 years ago
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