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mestny [16]
3 years ago
10

For each of the following, describe the opportunity cost when you decide to do each activity.

Business
1 answer:
Lina20 [59]3 years ago
5 0

Answer:

The opportunity cost of going to the beach is lost time to study for the exam

The opportunity cost of going to college is the lost earnings from getting a paying job after high school

The opportunity cost of eating breakfast is arriving late to school

The opportunity cost of going to the movies is not completing your portion of the group project

The opportunity cost of going to a party at a friend's house on a school night is the inability to wake up early the next morning

Explanation:

An opportunity cost is the lost benefit attached to choosing one option over  another. The scenarios given require the consequences which occur as a result of not choosing one option of the two alternatives presented. In each of the given cases, the foregone benefit varies depending on the option selected.

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The range of S is 74 while that of P is 37 across the two states. What is the hedge ratio of the put
lorasvet [3.4K]

This question is incomplete, the complete question is;

We will derive a two-state put option value in this problem.

Data: S₀ = 106; X = 112; 1 + r = 1.12. The two possibilities for ST are 149 and 75.

The range of S is 74 while that of P is 37 across the two states. What is the hedge ratio of the put

Answer: the hedge ratio of the put H = - 1/2 ≈ - 0.5

Explanation:

Given that;

S₀ = 106, X = 112, 1 + r = 1.12

Us₀ = 149 ⇒ Pu = 0

ds₀ = 75 ⇒ Pd = 37

To find the Hedge ratio using the expression

H = Pu - Pd /Us₀ - ds₀

so we substitute

H = 0 - 37 / 149 - 75

H = - 37/ 74

H = - 1/2 ≈ - 0.5

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