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3 years ago

The the existing spot price relative to the strike price, the valuable the call options will be.

Business

2 answers:

OLga [1]3 years ago

8 0

Answer:

The Higher the existing spot price relative to the strike price the more valuable the call options will be.

Explanation:

Spot price simply refers to how much a particular stock is trading in the market (that is, Market Price of the Stock).

Strike Price, also known as exercise price, is the price at which a person (corporate or individual) can purchase security.

Call options refers to the option to purchase an asset at an agreed price prior to/or at a particular day.

If for instance an employee is presented with Stock Options at a particular price, it will be more attractive for him or her if the price at which it is being offered is lower than it's actual market value. That way, he or she has already made a profit.

For example, if the spot price for the stock of Google is $2000/Unit and it is offered to an employee at $1450, if he elects to buy it at that time, he stands a chance to make $550 on each unit that if he sells whilst the spot price is still reasonable.

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Brrunno [24]3 years ago

5 0

Answer:

The higher the existing spot price relative to the strike price, the less valuable the call options will be.

Explanation:

Call options refer to financial contracts in which the buyer of the option has the right, but not obligation, to buy asset or instrument at an already agreed price on or before a particular date. The particular date is also known as the expiration date.

The strike price is refers to the price at which a put or call option can be exercised on or before a particular date.

The spot price refers the current market price at which an instrument or asset is bought or sold now for immediate payment and delivery.

The relationship between the strike price and the spot price is that a call option is most valuable when the strike price is higher than the spot price. At this point, the call option is said to be in the money (ITM). On the other hand, a call option is least valuable when the strike price is lower than the spot price. At this point, the call option is said to be out of the money (OTM).

Based on the explantion above, therefore, the higher the existing spot price relative to the strike price, the less valuable the call options will be.

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7 0

2 years ago

On December 30, Year 12, AGH, Inc. purchased a machine from Grant Corp. inexchange for a zero-interest-bearing note requiring ei

andrey2020 [161]

Answer:

$329,840

Explanation:

Calculation to determine the net note payable to Grant

Net note payable to Grant=$70,000 × 4.712

Net note payable to Grant= $329,840

Net note payable to Grant= ($70,000 × 5.712) – $70,000

Net note payable to Grant= $329,840

Therefore On AGH's December 31, 2017 balance sheet, the net note payable to Grant is:$329,840

6 0

3 years ago

Company X has a good whistle-blowing program in place. Sara used the whistle-blowing system to alert management about a fraud be

dedylja [7]

Answer:

lack of anonymity

Explanation:

According to my research on whistle-blowing systems within organizations, I can say that based on the information provided within the question the major issue that the program seems to have is a lack of anonymity. All whistle-blower systems are designed to be completely anonymous so that anyone who uses the system to do the right thing and report people who are breaking the law or rules are not mentioned and face backlash from co-workers. Apparently, the system that Company X is either not anonymous or is not adhering to the anonymity policy.

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6 0

3 years ago

Majestic Manufacturing sold Jordans Furniture a living room set for an $8,550 list price with 40% trade discount. The $125 freig

Ira Lisetskai [31]

Very last price of dwelling room set = net cost + Freight = ($8,560*80%*ninety nine%) + $a hundred thirty= $6,909.fifty two

"At a reduction" is a word used to describe the practice of promoting shares, or other securities, underneath their modern-day marketplace price, similar to a sale of products at a retail status quo.

A trade discount is a quantity by means of which a producer reduces the retail charge of a product whilst it sells to a reseller, in place of to the give-up consumer.

An exchange discount is a subtraction from the list rate of the goods, allowed through the dealer to the customer at an agreed price. On the opposite, a coins cut price is a discount allowed to the client, whilst he/she makes coins payment of the goods bought, within the stipulated time.

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4 0

1 year ago

The ____ the existing spot price relative to the strike price, the ____ valuable the call options will be.

The the existing spot price relative to the strike price, the valuable the call options will be.