Answer: $4.24
Explanation:
According to the Put-Call Parity, the value would be expressed by;
Put Price = Call price - Stock price + Exercise price *e^-(risk free rate *T)
T is 90 days out of 365 so = 90/365
= 2.65 - 26 + 28 * 2.71 ^ (-0.06 * 90/365)
= $4.24
Answer:
Positive Statements: 1st & 2nd ; Normative Statements: 3rd & 4th
Explanation:
Positive Economics is <u>objective</u> & <u>facts</u> based <u>actual</u> economic issue description , explaining verifiable phenomenas (causal relationships).
Normative Economics is <u>subjective</u> & opinion based conclusive <u>solutions</u> to economic issues, including '<u>ought to be</u>' unverifiable suggestions.
1. Lung cancer kills millions of people each year: reflects actual objective verifiable fact about an economic (health) issue.
2. Too many people smoke: denotes another actual objective variable fact connected to (potential cause of) the above economic (health) issue.
So , these two are Positive Statements.
3. If the government were to increase taxes on cigarettes, fewer people would smoke : Is subjective opinion based probable solution to the above economic (health) issue.
4. The government should increase taxes on cigarettes : Is an 'ought to' suggestion for an economic participant (govt) to solve the above economic (health) issue.
So , these two are Normative Statements
Answer:
D.
Explanation:
PERT and CPM are network planning techniques.
PERT means Program Evaluation and Review Technique.
CPM means Critical Path Method.
The six steps more common to PERT and CPM are:
-Define the project and identify each activity.
-Develop relationships among the activities.
-Draw the network connecting all of the activities.
-Adding time and/or cost estimates to each activity.
-Compute the longest time path through the network. This is called the critical path.
-Use the network to help plan, schedule, monitor and control the project.
Answer:
firms anticipate rival firms' decisions when they make their own decisions.
Explanation:
Game theory assumes that firms anticipate rival firms' decisions when they make their own decisions. It is very important and necessary for understanding firms operating in an oligopolistic market.
An oligopoly can be defined as a market structure comprising of a small number of firms (sellers) offering identical or similar products, wherein none can limit the significant influence of others.
Hence, it is a market structure that is distinguished by several characteristics, one of which is either similar or identical products and dominance by few firms.
This ultimately implies that, under the game theory, when firms makes a decision about their business, it is expected that they consider how the other firms would react to such decisions.
Answer:
$635,000 and : 34%
Explanation:
Margins of safety is the difference between expected sales and the break-even point.
For Zhao, expected sales are 10,000 units
The break-even points in units = fixed cost/ contribution margin per unit
fixed costs = $429,000
Contribution margin per unit = selling price - variable costs per unit
=$187 - $122
=$65
break-even point in units = $429,000/$65
break-even point = 6600 units
Margin of safety = 10,000 - 6600 units
=3400 units
In dollars is equal to margin of safety in units x selling price
=3400 x 187
<u>=$635,000</u>
as a percent of expected sales.
=3400/10000 x 100
=0.34 x 10,000
=34%