Answer:
On the ex date, the contracts will show as:
10 ABC Jan 60 Calls
The customer must exercise call contracts to buy the stock prior to the Ex-Date
Explanation:
The reason is that if the customer is not exercising the call contracts then it will not be able to receive the stock dividend. Furthermore, the OCC doesn't adjust the contract because of the dividend announcement prior to exercise of contract. This means it will only adjust if the contract is exercised.
The settlement of the exercise takes around 2 business working days, hence the customer must exercise the option 2 days earlier to the ex-date.
Answer:
The answer is B.
Explanation:
Capital is what is used to start a business. It is what the owner's contribution in the business. In advanced class, it is called stock or equity. Capital is usually from the owner's savings. But if this money is borrowed either from an individual or a bank, the person is a borrower while the other party is the lender.
Option A is incorrect because money raised from someone makes the person borrowing a borrower and not a saver.
Option C and D are incorrect because the items needed for the business are not consumables, they are needed for the smooth running of the business, hence they are not consumption.
Answer:
The best estimate of the company’s cost of equity is 12%
Explanation:
Estimate of the company’s cost of equity = (Required Return as per Capital Asset Pricing Model + Cost of Equity) / 2
Required Return as per Capital Asset Pricing Model = Risk Free rate + Market Risk Premium * Beta
= 4.9 % + ( 6% * 1.2)
= 0.049 + 0.06 * 1.2
= 0.049 + 0.072
= 0.1210
= 12.10%
Cost of Equity = (Expected Dividend/Price) + Growth Rate
= [( $ 1.30 * 1.08) / $ 36] + 8%
= 0.039 + 0.08
= 0.1190
= 11.90%
The best estimate of the company’s cost of equity = (12.10 % + 11.90 % )/ 2
= 24% / 2
= 12%
Hence, the best estimate of the company’s cost of equity is 12%
Answer: $460 billion, but the effect would be larger if there were an investment accelerator.
Explanation:
If the MPC = 0.75 and there is no investment accelerator or crowding out, then a $115 billion increase in the government expenditures would result in the shift in the aggregate demand curve right by:
= $115 billion ÷ (1 - 0.75)
= $115 billion ÷ 0.25
= $115 billion × 1/0.25
= $115 billion / 0.25
= $460 billion.
Therefore, there'll be a shift in the aggregate demand curve right by $460 billion, but the effect would be larger if there were an investment accelerator
The basis of competition is freedom of choice exercised in the pursuit of money.
<h3>What is competition?</h3>
Competition is a scenario where different economic firms are in contention to obtain goods that are limited by varying the elements.
The purpose of competition is for businesses to try to outdo each other in order to earn more.
Also, competition enable businesses come up with newer ways to please their customers, hence come up with amazing innovative ideas and better products.
Hence, the basis of competition is freedom of choice exercised in the pursuit of money.
Learn more about economic competition here : brainly.com/question/967467
