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3 years ago

Both a call and a put currently are traded on stock XYZ; both have strike prices of $45 and expirations of 6 months.

Business

1 answer:

pychu [463]3 years ago

6 0

Answer:

a. Profit to an investor who buys call for $4

a. $ -4

b. $ -4

c. $ -4

d. $ 1

e. $ 6

b. Profit to an investor who buys call for $6.5

a. $1.5

b. $6.5

c. $ -1.5

d. $ -3.5

e. $ -8.5

Explanation:

The call option is a derivative in which an investor buys an option to buy the asset at a certain price. The value of the call option is determined by maturity. The buyer of call option can buy an asset at a strike price before expiration date.

If the investor buys the call option for $4 then the $4 is an expense for the investor. The value of call will be -4 unless the stock price is above $50.

If the investor buys the call option for $6.5 then the $6.5 is an expense for the investor. The value of call will be -6.5 unless the stock price is below $50.

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A difference in quantity of materials used on two comparable jobs may be caused by a.employee carelessness b.poor quality materi

Elodia [21]

Answer: d.All of these choices are correct.

Explanation:

All the above can result in different quantities of materials being used for comparable jobs.

Employee Carelessness can cause more material to be used if they fail to adequately measure the Requirements of a job. If they are also careless in the usage of the material, there will be wastage and therefore a larger use of materials.

Poor Quality Materials can also result in different quantities being used because for instance, more material could be required to do something that a stronger material could have easily done.

Inadequately trained Employees is a major reason for Material Wastage. If employees are not trained by seasoned people who know how to reduce wastage, that knowledge could take time to come to them. If they were adequately trained however, they can master the tricks on wastage avoidance and limit discrepancies in the amount of materials used per comparable jobs.

7 0

3 years ago

Suppose a small country has a comparative advantage in the production of consumer electronics, and it has one major electronics

zlopas [31]

Answer:

Imports create greater competition in the domestic marketplace.

Explanation:

Comparative advantage is defined as the ability of a company to produce goods at a lower opportunity cost than other competitors. They can now sell the goods at lower prices.

If the company in this scenario have competitive advantage in producing electronics then it is xheap for them to produce.

When they export electronics and import again, it can only mean that the imported electronics have a competitive edge that the company wants to take advantage of. For example higher quality than what is available locally.

4 0

3 years ago

Read 2 more answers

Singh Co. reports a contribution margin of $960,000 and fixed costs of $720,000. (1) Compute the company’s degree of operating l

Alex

Answer: 1. Degree of Operating Leverage = 4

2. $384,000

Explanation:

1. Degree of Operating Leverage is calculated by dividing the Contribution margin by the Net Operating income.

Now, the Contribution margin is the difference between Price and Variable Cost. This means that if you remove fixed costs from it as well you get your profit.

Therefore 1. can be calculated thus,

Degree of Operating Leverage = Contribution Margin / Net Operating income

Degree of Operating Leverage = 960,000 / 960,000 - 720,000

Degree of Operating Leverage = 4

2. When Sales increases by a certain percentage we multiply that percentage by the Degree of Operating Leverage to find out how much Income will increase by.

Because sales went up by 15%, Singh Co. can expect that income would rise by,

= 15% * 4

= 60%.

Now income is Contribution margin - fixed costs so we have,

Income = 960,000 - 720,000

Income = $240,000

An increase of 60% would be

= 240,000( 1+ 60%)

=$384,000

$384,000 is the amount of income that Singh Co. can expect.

4 0

3 years ago

A company manufactures cell phone cases. The company's daily average level of output is 10,000 cases, and its total daily cost o

garri49 [273]

Answer:

Explanation:

Unit labour cost = $50,000 / 10,000 = $5

I hope my answer helps you

6 0

3 years ago

A company receives a 10%, 120-day note for $1, 500. The total interest due on the maturity date is:______.a) $50,00. b) $150,00.

Leto [7]

Answer:a) --A -$50.00

Explanation:

Using days of year = 360 days

Interest due = Principal x rate x period

= $1500 x 10% x 120/360

= $50

The total interest due on the maturity date is:__$50.00___

6 0

3 years ago