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lukranit [14]
3 years ago
10

Diwali Airlines has a contract that gives them the opportunity to purchase up to 10,000,.000 jet fuel at $2.00 per gallon. The c

urrent market price of jet fuel is $226 per gallon. Diwali believes gallons of they will only need 6,000,000 gallons of jet fuel. What is the value of this opportunity?21) A) $9,040,000 B) $2,600,000 C) $1.040.000 D) $1.560.000
Business
1 answer:
Ad libitum [116K]3 years ago
8 0

Answer:

Option (D) is correct.

Explanation:

Diwali Airlines has a contract,

Given that,

There is an opportunity to purchase jet fuel upto = 10,000,000 gallons

Price = $2 per gallon

Current market price of jet fuel = $2.26 per gallon

The value of this opportunity:

= Jet fuel needed × (Current market price - $2)

= 6,000,000 gallons × $0.26

= $1,560,000

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Even though most corporate bonds in the United States make coupon payments semiannually, bonds issued elsewhere often have annua
max2010maxim [7]

Answer:

Market Price $985.01

Explanation:

We have to convert the US semiannually rate to annually.

(1 + 0.078/2)^{2} -1 = 0.079521

Now this is the annual rate spected for a similar US Bonds

So we are going to calculate the present value using this rate.

Present value of an annuity of 78 for 20 years at 7.9521%

C * \frac{1-(1+r)^{-time} }{rate} = PV\\

78 * \frac{1-(1+0.079521)^{-20} }{0.079521} = PV\\

PV = 768.55

And we need to add the present value ofthe 1,000 euros at this rate

\frac{Principal}{(1 + rate)^{time} = Present Value}

\frac{1,000}{(1 + 0.079521)^{20} = Present Value }

Present Value = 216.4602211

Adding those two values together

$985.01

The reasoning behind this is that an american investor will prefer at equal price an US bonds because it compounds interest twice a year over the German Bonds.

6 0
3 years ago
All of the following are basic requirements for a fulfilling career except:
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Answer:

Continual overtime

Explanation:

5 0
4 years ago
An initial investment of $930 is appreciated for 19 years in an account that earns 6% interest, compounded continuously. Find th
Hunter-Best [27]

The amount of money in the account at the end of the period will be $2907.89.

<h3>What is the investment?</h3>
  • The dedication of an asset to achieve a gain in value through time is referred to as an investment.
  • Investment necessitates the sacrifice of a current item, such as time, money, or effort.
  • The goal of investing in finance is to earn a return on the invested asset.
  • A gain (profit) or loss realized through the sale of a property or investment, unrealized capital appreciation (or depreciation), or investment income such as dividends, interest, or rental income, or a mix of capital gain and income, may constitute the return.
<h3>To find the amount of money in the account at the end of the period:</h3>

Step 1: Define

Identify variables

P = 930

t = 19

r = 6% = 0.06

Step 2: Find Interest

Substitute in variables [Compounded Continuously Formula]: A=930e^{} ^{19*0.06}                  

[Exponents] Multiply:    

A=930e^{1.14}                                                                                  

Evaluate exponents:            

A=930(3.12677)                                                                            

Multiply:            

A=2907.89

Therefore, the amount of money in the account at the end of the period will be $2907.89.

Know more about investment here:

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5 0
2 years ago
Why does an oligopoly only work if there are high barriers to entry in a market?
erastovalidia [21]
An oligopoly is the limitation of competition. If you can keep competitors out of the marketplace, you have more of a chance to make a profit. If you are in a business with a very high capital outlay or you have an extremely well trained labor force that your competitors can't match then you have effectively created or have created for you a very high barrier. Hence an oligopoly.
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Web application firewalls, security information and event management systems, access controls, network security monitoring, and
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<span>Web application firewalls, security information and event management systems, access controls, network security monitoring, and change controls help to keep the "soft center" from becoming an easy target when the perimeter fails.</span>
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