Answer:
The correct answer is $320.
Explanation:
According to the scenario, computation of the given data are as follows:
MSFT price at expiry (S_T) = $250
MSFT with strike (K) Contract 1 = $220
MSFT with strike (K) Contract 2 = $120
So, we can calculate the payoff by using following formula:
Payoff = [(Stock price at expiry (ST) - Strike price of $220)] + [(Stock price at expiry (ST) - Strike price of $120)]
BY putting the value, we get
Payoff = ($250 - $220) + ($250 - $120)
= $30 + $130
= $160
As there are 2 contracts, then
Total payoff = $160 × 2
= $320
Answer: "white flight" .
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The following that most strongly implied by this information is that at the current level of production, the firm is making a profit of $3000. Jake and Mathew will most likely agree on The firm should increase production from the current level. Mathew is assuming that no new firms enter the market in the short run.
Answer:
$50,400
Explanation:
To do this first start by multiplying .12 x 35,000. The answer should be $4,200. After this multiply 4,200 by 12 in order to get the amount of money earned over a 12 month period. This will give you $50,400.
