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SSSSS [86.1K]
3 years ago
12

Suppose the S&P 500 index is currently 950 and the initial margin is 10%. You wish to enter into 10 S&P 500 futures cont

racts. a. What is the notional value of your position? What is the margin? b. Suppose you earn a continuously compounded rate of 6% on your margin balance, your position is marked to market weekly, and the maintenance margin is 80% of the initial margin. What is the greatest S&P 500 index futures price 1 week from today at which you will receive a margin call?
Business
1 answer:
vagabundo [1.1K]3 years ago
7 0

Answer:

$930.89

Explanation:

The Notional value of position = Price of S&P-500 index future x Contract multiplier x no. of contracts

= 950x250x10

=$2,375,000

Margin = Total nominal value of position x Initial margin

=2375,000x10%

=$237,500

b) Maintenance margin = Initial margin x Maintenance margin

=237500 x 80%

=$190,000

Margin call will be receive when value of the Initial margin falls below maintenance margin

Thus 237500e^0.06/52 + (St -950) x250 x10 <190,000

From here St = price at which margin call will be made

=237500e^0.0011538 + (St -950) x 2500 <190,000

=237500(1.0011538) + (St -950) x 2500 <190,000

=237774.04 + (2500St - 2375000) < 190,000

=2500St - 2137226 <190,000

= 2500St <2327226

St < 930.89

Thus price below $930.89 will be called maintenance margin.

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Answer:

A...increase

B...be unchanged

C....increase

Explanation:

It should be understood that it is only the telephone lines that was increased and not the number of the customer representatives, and also the number of the time they were using to attend to each customer was not reduced. So in this case, the number of customers that will be experience delay will definitely increase, why the time spent on phone by the customer representatives will remained unchanged, and the customer representatives utilization will increase too.

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3 years ago
Outose Concept manufactures small tables in its Processing Department. Direct materials are added at the initiation of the produ
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Answer:

C) $25,177

Explanation:

Spoiled units = (22,300 units + 76,400) - (72,900 units + 19,000)

=$98,700units -$91,900 units

= 6800 units

Normal spoilage = 5% × 72,900 units

= 3,645 spoiled units

Abnormal spoilage = 6800 units - 3645 units

= 3,155 units

Direct Materials ,Conversion Costs

WIP, beginning inventory$156,000$77,200

Costs added

during period 224,400 299,000

Total cost to account for 380,400 376,200

Divide by equivalent units*98,700 91,100

Equivalent-unit costs $3.85 $4.13

Equivalent unit

Direct Materials: 22,300 + 76,400 = 98,700 units

Conversion Costs: 72,900 + (19,000 x 60%) + 6800 = 91,100 units

Total cost per equivalent unit = $3.85 + $4.13 = $7.98

3155 units × $7.98 = $25,177

Therefore the cost allocated to abnormal spoilage using the weighted-average process-costing method will be $25,177

4 0
2 years ago
Which workplace trait means fulfilling your commitments in time or in advance?
Drupady [299]
I believe the answer is Time management
6 0
3 years ago
Who bought the treasure island hotel and casino from the Wynn corporation?
IgorLugansk [536]
Phil Ruffin bought treasure island
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3 years ago
A firm agreed to pay its workers ​$2525 an hour in 2016 and ​$4141 an hour in 2017. The price level for these years was 241 in 2
NemiM [27]

Answer:

(a) 10.4%; 16.73%

(b) 6.33%

Explanation:

Given that,

Wages paid to the workers in 2016 = $25 per hour

Price level in 2016 = 241

Wages paid to the workers in 2017 = $41 per hour

Price level in 2017 = 245

Real wage rate in 2016:

= (Nominal wages ÷ Price level) × 100

= ($25 ÷ 241) × 100

= 0.104 × 100

= 10.4%

Real wage rate in 2017:

= (Nominal wages ÷ Price level) × 100

= ($41 ÷ 245) × 100

= 0.1673 × 100

= 16.73%

Therefore, the real wage increase received by these workers in​ 2017 is calculated as follows:

= Real wage rate in 2017 - Real wage rate in 2016

= 16.73% -  10.4%

= 6.33%

Hence, these workers do get a raise between the two years.

8 0
2 years ago
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