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amm1812
3 years ago
14

Problem 3.1. A European call option on a stock with a strike price of $50 and expiring in six months is trading at $14. A Europe

an put option on the stock with the same strike price and expiration as the call option is trading at $2. The current stock price is $60 and a $1 dividend is expected in three months. Zero coupon risk-free bonds with face value of $100 and maturing after 3 months and 6 months are trading at $99 and $98, respectively. Identify the arbitrage opportunity open to a trader.
Business
1 answer:
pantera1 [17]3 years ago
7 0

Answer:

The. Trader should buy the out option

Explanation:

See attached file

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During the current year, the company had the following summarized activities:
scoray [572]

Answer:

D

Explanation:

4 0
3 years ago
What is the most common factor in the code of ethics for many professional organizations?
serg [7]

Answer:

The correct answer is: information, training, and credentials are based on evidence-based practice.

Explanation:

Business ethics, in addition to having a responsibility for the common good, is a commitment to permanent respect for all its associates: its staff, its customers, its investors, its suppliers, its creditors and the State as representative of the society.

Thus, ethics should contribute to strengthening the credibility and reliability of the entire society in the company, managing to satisfy the wishes and attending to the rights of all its stakeholders.

8 0
3 years ago
Chrzan, Inc., manufactures and sells two products: Product E0 and Product N0. Data concerning the expected production of each pr
Trava [24]

Answer:

A. $59.78 per MH

Explanation:

The computation of activity rate for the Order Size activity cost pool under activity-based costing is shown below:-

Activity rate for the Order Size activity cost pool = Activity pool cost ÷ Total expected activity

= $579,866 ÷ 9,700

= $59.78 per MH

Therefore for computing the activity rate for the Order Size activity cost we simply applied the above formula and ignore all other value as the other values are not relevant.

7 0
4 years ago
The demand for plumbers is the same in country A and country B, but the plumbers in country A earn less than the plumbers in cou
Tpy6a [65]

Answer:The supply of plumbers in country A is greater than the supply of plumbers in country B.

Explanation:

The state of demand and supply of labour has a great effect on wages of workers. If the supply of plumbers is grater than the number s of households demanding plumbering services the wages for the plumbers will fall because more plumbers are available for the few works available and this is the situation why plumbers in country A earn less than B though the demand in both countries are the same but they do not vary in the same proportion with their demands.

The supply of plumbers in B is not greater than A and this why B earn more. Productivity refers to measuring the level of outputs in relation to the inputs such labour, capital in production and this does not have impact on wages compare to demand and supply of labour but it's impact is on production.

6 0
4 years ago
At the end of the current year, $22,650 of fees have been earned but have not been billed to clients. Required: A. Journalize th
const2013 [10]

Answer:

A. Adjusting Journal Entries:

Dec. 31, 2019:

Debit Accounts Receivable $22,650

Credit Service Fee Revenue $22,650

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B. No. If the cash basis rather than the accrual basis had been used, an adjusting entry would not have been necessary.

Explanation:

Adjusting entries are only required to align the cash-basis accounting records to the accrual basis.  Adjustments are made for prepayments of expenses, unpaid expenses, deferred revenue, unearned earned and earned revenue, and depreciation charges.  For an entity operating on a cash basis, adjusting entries are not required.

Adjusting entries ensure that accounting records comply with the accrual concept and matching principle of generally accepted account practises.  The requirement under this concept with the matching principle is to accrue and match expenses and revenue to the related revenue and expenses and period.

7 0
4 years ago
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