Answer: C. equal zero
Explanation:
The mean is average of the portfolio which means that some securities will be more than the mean and some will be less.
Some deviations will be positive, others will be negative.
When these deviations are added together, the negative deviations will cancel out the positive deviations which will lead to the average deviations being 0.
Answer:B. One year from now Bond A's price will be higher than it is today.
Explanation:A Noncallable bond is a bond whose investment cannot be redeemed before its maturity date by the issuer, it can only be redeemed after the payment of a penalty.
The issuer of a noncallable bond makes itself vunerable to interest rate risk mainly because, at the issuance of the bond, it is locked to the interest rate it will pay only when the bond's maturity date is achieved.
Coupon rate is the rate at which a bond repay its owner,it can be annual.
Answer: c. Ten years, because maintenance costs don't increase.
Explanation:
With the maintenance costs constant at $24,000 a year, the machine is still expected to go 10 years before it's x-ray source is depleted and it has to be scrapped.
This means that the useful life is therefore 10 years because the maintenance cost will not increase but will still keep the machine going for 10 years.
Answer:
$13.64
Explanation:
Given:
Exercise price,X = $100
Current price = $100
Value when price is up, uS = $120
Value when price is down, dS= $80
Risk free interest rate = 10%
First calculate hedge ratio, H:
Where,
Cu = uS - X
= 120 - 100
= $20
A risk free portfolio involves one share and two call options.
Find cost of portfolio:
Cost of portfolio = Cost of stock - Cost of the two cells.
= $100 - 2C
This portfolio is risk free. The table below shows that
_______________
Portforlio 1:
Buy 1 share $80; Write 2 calls: $0; Total: ($80 + 0) $80
____________________
Portforlio 2:
Buy 1 share: $120; Write 2 calls: -$40; Total: ($120 - $40) $80
Check for oresent value of the portfolio:
Present value 
Value = exercise price - value of option
$72.73 = $100 - 2C
Find call option, C

Call option's value = $13.64
Orlando is 18 degrees
10+ 8 = 18
The 10 represents how much warmer Orlando is and the 8 represents the temp in Houston