1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
vodomira [7]
3 years ago
14

A firm wants to use an option to hedge 12.5 million in receivables from New Zealand firms.The premium is $.03. The exercise pric

e is $.55. If the option is exercised, what is the totalamount of dollars received (after accounting for the premium paid)?a. $6,875,000.b. $7,250,000. c. $7,000,000.d. $6,500,000.e. none of the above
Business
1 answer:
morpeh [17]3 years ago
3 0

Answer:

d. $6,500,000 dollars

Explanation:

Hedging is a strategy used by investment firms that want to minimize the risk of loosing their investments, so what they basically do is giving up the actions and investments and get some money in return, the exercise price is what they will pay you for your total investment, and the premium fee is somthing you have to pay to hedge an investment:

So you multiply the 12.5 million by .55 which is the amount you´ll receive, and withdraw form that the premium:

12,500,000x.55=$6,875,000

12,500,000x.03=$375,000

$6.875,000-$375,000= $6,500,000

The firm will receive $6,500,000 dollars.

You might be interested in
Acton Corporation, which applies manufacturing overhead on the basis of machine-hours, has provided the following data for its m
algol [13]

Answer:

option (b) $69,768

Explanation:

Data provided in question:

Estimated manufacturing overhead = $73,440

Estimated machine-hours = 1,800

Actual manufacturing overhead = $68,700

Actual machine-hours = 1,710

now,

The predetermined overhead rate = \frac{\textup{Estimated manufacturing overhead}}{\textup{Estimated machine-hours}}

or

The predetermined overhead rate = \frac{\textup{73,440}}{\textup{1,800}}

or

The predetermined overhead rate = $40.8 per hour

Therefore,

The applied manufacturing overhead for the year

=  Actual machine-hours × predetermined overhead rate

= 1,710 × $40.8

= $69,768

Hence,

the correct answer is option (b) $69,768

5 0
3 years ago
Because leaders need to devise effective solutions in short time spans with limited information, they need to have
Ghella [55]

1. Because leaders need to devise effective solutions in short time spans with limited information, they need to have cognitive abilities.

2. Trait appraisals are subject to validity problems due to evaluator bias.

Explanation:

Cognitive abilities are knowledge based on the brain, which we need to perform from easy to complex tasks. They are mostly about how they read, recall, resolve issues and pay close attention than about any true knowledge. They were about how they think.

Traits have included the personality, behavior, leadership, work ethics, leadership skills, ethical sense, loyalty, flexibility, and judgment. On either hand, if the trait is legitly related to the work, then it might be valued.A trait is a person's own characteristic.

5 0
3 years ago
Suppose autos cost consumers $30,000 and trucks cost consumers $15,000. What contribution does the production of 200 autos and 2
alexgriva [62]

Answer:

the  contribution made to the production of 200 autos and 200 trucks is $9,000,000

Explanation:

The computation of the contribution made to the production of 200 autos and 200 trucks is shown below

Contribution to GDP is

= $30,000 × 200 + $15,000 × 200

= $6,000,000 + $3,000,000

= $9,000,000

Hence, the  contribution made to the production of 200 autos and 200 trucks is $9,000,000

6 0
3 years ago
Canned food available for sale at grocery stores have been subjected to a commercial canning process. If you bought a can of pea
umka21 [38]

Answer:

Three things:

-Under processing before canning

-Spoilage before canning

-entrance of water through can seams during cooling

Explanation:

The preservation process is aimed at reducing the rate of spoilage of food products over time.

When adequately processed a time can be given during which the food product is still not spoilt. For example 1 year from date of canning. After this period there is a high possibility of food spoilage.

If a can of peas was bought from a grocery and it is spoilt it is either the peas were not well processed, there was spoilage before commercial canning, or water entered when cooling during canning

4 0
2 years ago
A primary difference between macroeconomics and microeconomics is
sleet_krkn [62]

'Micro is the study of individuals and business decisions while macroeconomics while macro studies the decisions of the governments and countries.'

Microeconomics examines individual markets while macroeconomics examines the economy.

6 0
2 years ago
Other questions:
  • What is a risk assessment?
    8·1 answer
  • Select the correct answer.
    15·1 answer
  • You are considering two independent projects that have differing requirements. Project A has a required return of 12 percent com
    15·1 answer
  • Suppose it costs $2,500 to buy a defibrillator. Find the expected value of owning a defibrillator if there is a 4% probability t
    10·1 answer
  • Adam smith called the force that guided the competition from scarce resources in a free market the _____ a0 hand
    10·1 answer
  • Rent controls are a typical example of a price ceiling.
    12·1 answer
  • The following account balances were taken from the 2021 post-closing trial balance of the Bowler Corporation: cash, $9,500; acco
    7·1 answer
  • Preble Company manufactures one product. Its variable manufacturing overhead is applied to production based on direct labor-hour
    14·1 answer
  • An American clothing manufacturer has recently purchased a clothing factory in Taiwan. This action is known as ________.
    14·1 answer
  • Alpha ended 2019 with a balance of $20 million in their salaries payable account. If their salary expense in 2019 was $90 millio
    11·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!