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mamaluj [8]
3 years ago
5

You write one MBI July 139 call contract (equaling 100 shares) for a premium of $17. You hold the option until the expiration da

te, when MBI stock sells for $150 per share. You will realize a ______ on the investment.
Business
2 answers:
stich3 [128]3 years ago
7 0

Answer: $600 profit

Explanation:

Call contract = $139

Number of shares = 100

Selling price per share = $150

Premium = $17

(Call contract - selling price) × number of shares

($139 - $150) × 100 = -$1100

Total premium = $17 × 100 = 1700

PROFIT / LOSS ON investment = - $1100 + $1700

= $600

OR

Short call profit = Min [0, ($139 - $150)(100)] + $1700 = $600

$600 profit

Bogdan [553]3 years ago
4 0

Answer:

$600 loss

Explanation:

A call option is defined as a contract that exists between ba buyer and seller of a call option to exchange securities held at a particular price within a specific period.

To calculate the profit realised on the investment

Profit from call option= (150- 139) * 100

Profit from call option= $1,100

Profit from premium= 17 * 100

Profit from premium= $1,700

Profit on investment= Profit from call option - Profit from premium

Profit on investment = 1,100 - 1,700 = -$600

So there is a loss of $600

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Answer:

The Federal Reserve is in charge of the monetary policy in the United States. It expands or reduces the money supply (the total amount of money in the economy) by raising or lowering the interest rate.

There is a relationship, in the short run, between unemployment and money supply. The higher the money supply, the lower the unemployment rate, and viceversa: the lower the money supply, the higher the unemployment rate.

This relationship exists because when the money supply increases, the interest rate falls, if the interest rate falls, investing becomes cheaper, and as a result, firms invest more and hire more workers.

The opposite happens when the money supply is contracted: interest rates rise, investing becomes more expensive, and firms hire less people.

This is why the Fed has a great deal of power when it comes to employment in the economy.

7 0
3 years ago
How can pricing range influence pricing strategy
Otrada [13]

When two products have similar core features, but are produced by different companies, competition results. Research your competition to figure out where you fit in or what to change.

6 0
3 years ago
Restaurant A uses 60 bags of potatoes each month. The potatoes are purchased from a supplier for a price of $80 per bag and an o
iVinArrow [24]

Answer:

D. Decreases from 30 to 28.5 bags

Explanation:

The computation of the economic order quantity is shown below:

= \sqrt{\frac{2\times \text{Annual demand}\times \text{Ordering cost}}{\text{Carrying cost}}}

where,

Carrying cost is $80 × 40% = $32

Annual demand = 60 bags × 12 months = 720 bag

And, the ordering cost is $20 per order

Now put these values to the above formula  

So, the value would equal to

= \sqrt{\frac{2\times \text{720}\times \text{\$20}}{\text{\$32}}}

= 30 bags

Now the demand is decreased by 10% So, the annual demand would be

= (60 - 6) × 12 months

= 54 bags × 12 months

= 648 bags

The other things will remain the same  

Now put these values to the above formula  

So, the value would equal to

= \sqrt{\frac{2\times \text{648}\times \text{\$20}}{\text{\$32}}}

= 28.46 bags

4 0
3 years ago
____ institutions accept and manage customer deposits in checking and savings accounts.
gtnhenbr [62]

Answer:

The correct answer is depository institutions.

Explanation:

We denominate Depository institution to financial entities that can legally receive and manage monetary deposits from costumers.

This institution serves as a way to keep a person's money securely, and thus achieve the physical security of the person who owns the money, since having a certain amount of money with himself can be dangerous.

A client will give his money to a depository institution, which also have several types of bank accounts, and when the client wishes, that money will be returned.

The depository Institution, while saving your money, can use it to make investments or to lend to other costumers.

6 0
3 years ago
"Suppose you wish to have $5,500 in 18 years. Use the present value formula to find how much you should invest now at 6% interes
Irina-Kira [14]

Answer:

The amount of investment should be $1926.891 approximately

<u>Explanation:</u>

The following formula has been used to calculate the amount of investment

A = P(1+r/100) ^n

where: A = future value , P = present value , R = rate of interest , N = time period

Hence , applying the formula, we get,

$5500 = P (1+6/100) ^18

Hence P=$5500/ (1.06) ^18

=$1926.891(approx)

7 0
3 years ago
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