I believe it is C, wholesale price.
Answer:
n = 100 customers
X = 80 who paid at the pump
A) the sample proportion = p = X / n = 80 / 100 = 0.8
we can definitely state that 80% of the customers paid at the pump.
B) if we want to determine the 95% confidence interval:
z (95%) = 1.96
confidence interval = p +/- z x √{[p(1 - p)] / n}
0.80 +/- 1.96 x √{[0.8(1 - 0.8)] / 100}
0.80 +/- 1.96 x √{(0.8 x 0.2) / 100}
0.80 +/- 1.96 x √{(0.8 x 0.2) / 100}
0.80 +/- 1.96 x 0.4
0.80 +/- 0.0784
confidence interval = (0.7216 ; 0.8784)
C) We can estimate with a 95% confidence that between 72.16% and 87.84% of the customers pay at the pump.
Total equity of the company is the amount of invested plus the income generated during the year. If any dividend is paid during the year, the amount of dividend is subtracted before arriving at the ending shareholders’ equity.
Ending shareholders’ equity = Amount invested + Net Income – Dividend
= $15000 + ($35000- $23000) - $2000
= $27000
Therefore, shareholders’ equity balance would be $27,000.
Answer:
Value of the call option using Black-Scholes Model is $3.47
Explanation:
d1 = 0.175
• d2 = -0.025
• N(d1) = 0.56946
• N(d2) = 0.49003
N(d1) and N(d2) represent areas under a standard normal distribution function.
Stock price: $40.00 N(d1) = 0.56946
Strike price: $40.00 N(d2) = 0.49003
Option maturity: 0.25
Variance of stock returns: 0.16
Risk-free rate: 6.0%
The Black-Scholes model calculates the value of the call option as:
V = P[N(d1)] – Xe^rt[N(d2)]
= $40(0.56946) – $40e^rt(0.49003)
= $22.78 – $19.31
= $3.47
