you own $750000 worth of stock, and you are worried the price may fall by year-end in 6 months. you are considering

Business

1 answer:

timofeeve [1]2 years ago

8 0

Answer: D. I, II, and III

Explanation:

If expecting a price deduction, you can buy Put options. These give you the right to sell an underlying stock at a certain price regardless of what the price in the market is. If you purchased this, you can sell your stock above market value if it does go down.

You can sell write call options for a fee where you give the buyer the right to buy your shares at a certain price in future. This is only valuable if prices rise so as you are expecting prices to fall, you could make a premium on the call option contract fees if prices fall without having to sell off your shares.

Hedging with puts is better than short calls if you are expecting a major stock price decline as the opportunity for profit is higher.

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All of the following statements about stock indexes are true EXCEPT

sesenic [268]

Answer:

C. stock indexes are unbiased and perfect indicators of market activity.

Explanation:

Stock indexes are a tool that is used to track a group of assets using standardised criteria.

Usually indexes monitors a group of securities. Indexes can be broad based or specialised.

Indexes are statistically derived benchmarks that securities are measured against. They are however not unbiased and perfect indicators of market activity.

This is because investor behaviour cannot be guaged statistically.

However indexes replicate the market activity in a certain segment of the stock market, serve as a benchmark to evaluate investment manager performance, and are based on criteria that define the market segment of interest.

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3 years ago

Suppose that the raw daily oxygen purities delivered by an air-products supplier have a standard deviation σ ≈ .1 (percent), and

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<span>approximate the probability that the sample mean x of n using the given formuka</span>

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2 years ago

All of the following statements regarding retained earnings are true exceptA. retained earnings represents a claim on cash.B. a

-BARSIC- [3]

Answer:

A) retained earnings represents a claim on cash.

Explanation:

Retained earnings are the accumulated profits that a company keeps that are left after dividends are paid. Retained earnings are the equivalent of a savings account for an individual. Retained earnings are shown in the balance sheet as part of owners' equity.

For example, corporation A had a net profit of $10 million during last year, and it paid dividends for a total of $4 million, its retained earnings for last year are $6 million.

Companies use retained earnings as money available for financing new or existing projects.

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3 years ago

1. Which of the following would a person who works in trade labor enjoy doing? Select all that apply.

rodikova [14]

1. A,B,C

A. adding plumbing to a new building

B. creating a piece of furniture

C. preparing food to serve to customers

2. B,C

B. using medical terminoligy

C. managing office personnel