You short-sell 200 shares of Tuckerton Trading Co., now selling for $50 per share. What is your maximum possible loss

Business

1 answer:

pentagon [3]3 years ago

5 0

Answer:

Unlimited

Explanation:

GIven that:

You short-sell 200 shares of Tuckerton Trading Co

now selling for $50 per share.

If a short-sell occurs on a trade, the lower the share price, the higher the profit your are liable to achieve but if short-sell occurs and the share price is higher, then the more loss you're going to accumulate.

From the question, the lowest possible share price is zero and the highest possible share price is infinity since there is no stop loss.

∴

The maximum possible loss = 200 × 50( 1 - infinity share price)

= Unlimited loss

You might be interested in

The principal purpose of a voucher system is to provide assurance that

ziro4ka [17]

The principle purpose of a voucher system is to provide assurance that all cash payments are approved before a check is issued. A voucher system is a way of internally controlling that helps prevent fraudulent withdrawals from a company by employees or people outside the organization. A voucher system organizes procedures to verify and approve cash disbursements, which is important because cash is vulnerable to theft. The voucher system helps guard a company's cash.

7 0

3 years ago

Floor drains are rapidly becoming extinct in the United States because they: A) Cause slips and trips B) Are too expensive to in

uranmaximum [27]

I believe the answer is D

7 0

3 years ago

The federal government is concerned about obesity in the United States. Congress is considering two plans. One will ban the prod

ddd [48]

Answer:

The junk-food ban will reduce the quantity of junk food sold and raise the price. The education program will reduce the quantity of junk food sold and lower the price

Explanation:

4 0

3 years ago

Lowden Company has an overhead application rate of 165% and allocates overhead based on direct material cost. During the current

AlekseyPX

Answer:

The amount of overhead that Lowden should be recorded in the current period = 165% * $74,000 = $122,100

Explanation:

6 0

3 years ago

Puedes enviar documentos escaneados o Digitalizados desde el Celular

love history [14]

Cierto 

Solo depende del tipo de teléfono que se utilice para enviar el documento. Creo que hay algunos teléfonos que se configuran más como computadoras que te permiten enviar documentos. Sin embargo, hay muchos teléfonos que no cuentan con esta función y es probable que la mayoría de los teléfonos celulares que usa la gente en la actualidad no realicen esta acción.

Espero que esto te ayude y que tengas un buen día.

-R3TR0 Z3R0

4 0

2 years ago