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Reptile [31]
3 years ago
13

The common stock of the C.A.L.L. Corporation has been trading in a narrow range around $125 per share for months, and you believ

e it is going to stay in that range for the next 6 months. The price of a 6-month put option with an exercise price of $125 is $10.50. a. If the risk-free interest rate is 5% per year, what must be the price of a 6-month call option on C.A.L.L. stock at an exercise price of $125 if it is at the money? (The stock pays no dividends.
Business
1 answer:
Fiesta28 [93]3 years ago
7 0

Answer:

he price of a 6-month call option on C.A.L.L. stock is 15.27

Explanation:

The price of a 6-month call option on C.A.L.L. stock at an exercise price of $125 is computed as;

C+Xe^{rt}  = P + S

Where as,

C = Value of call,

X = strike price,

P = value of put ,

S = Stock price

Thus,

C + 125e^{-5} = 10.27 + 125

C + 120 = 135.27

C = 15.27

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vlabodo [156]

Answer:

the rate of return is 8.41%

Explanation:

given data

Present value = $120,000

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solution

We will applied the rate formula that is.

The NPER  reflects the time period.  

and formula is that

NPER = Rate(NPER;PMT;-PV;FV;type)

so we get here

the rate of return is 8.41%

8 0
3 years ago
If the price of money (e.g., interest rates and equity capital costs) increases due to an increase in anticipated inflation, the
goldenfox [79]
It may be true but double check
7 0
3 years ago
Emily Lim owns and runs an ice cream parlor in San Diego. Last year, she had sales of $490,000 and an average tax rate of 32%. S
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Answer:

1). EBIT = Sales - Expenses - Depreciation

= $490,000 -($49,000 - $24,500 - $73,500 - $98,000 - $73,500 - $49,000) - $14,700

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5 0
3 years ago
Suggest any 5 methods by which the condition of technical education can be improved ​
MrMuchimi

Answer:

Acknowledge and address overcrowding.

Make funding schools a priority.

Address the school-to-prison pipeline.

Raise standards for teachers.

Put classroom-running and curriculum-building decisions in the hands of the community.

Explanation:

Technology can be utilized to improve teaching and learning and help our students be successful. ... Through the use of learning management systems (LMS) students can access online resources to get assistance on demand beyond the physical reach of their teacher. Technology can also extend education in another way.

assisted projects aimed at improving technical and vocational education. Introduction ... priorities as defined by aid recipients (see, for example, Gray &.

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5 0
2 years ago
At its date of incorporation, Wilson, Inc. issued 100,000 shares of its $10 par common stock at $11 per share. During the curren
Alla [95]

Explanation:

The journal entry to record the re-issuance of the stock is shown below:

Cash A/c Dr $240,000      (20,000 shares × $12)

Retained earnings A/c Dr  $80,000

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(Being the re-issuance of the stock is recorded)

The computation is shown below:

For treasury stock

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8 0
3 years ago
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