Answer:
$9.00.
Explanation:
The computation of the value of a put option is shown below:
Data provided in the question
Current price of the stock = $50
Risk free rate = 6%
Strike price = $55
Sale price = $7.20
Based on the above information
The value of put option is
Put = V - P + X exp(-r
t)
= $7.20 - $50 + $55 e
RF - 0.06(1)
= $7.20 - $50 + $51.80
= $9.00
Hence, the value of put option is $9
Answer:
The correct answer is letter "D": Opportunity cost.
Explanation:
Opportunity cost is described as the return of the choice selected over the potential return that could have been obtained from the choice left behind. It represents the return of the option chosen compared to the choice forgone. Opportunity costs is also defined as the return of the best next available option.
Answer:
B) Abstraction forms an important part of economic analysis.
Explanation:
Economic abstraction refers to ignoring certain factors while doing economic analysis. Some minor or even important economic details must be assumed when trying to analyze certain situations. That is why economists love to use ceteris paribus (everything else constant). Macroeconomic theory is impossible to prove in a scientific way, only certain microeconomic theories can be tested scientifically. In order to perform macroeconomic analysis, economists must simplify the real world, since economy is too complex and has too many factors that can alter any possible analysis. It is impossible to analyze a nation's economy as a whole since millions of people and businesses make billions of economic decisions very day.
Elaina and Allen just purchased a home using a deed of trust: A trustee will keep the title in its most basic form until the debt is paid off. This is further explained below.
<h3>What is a deed of trust?</h3>
Generally, From the perspective of the lender, a deed of trust offers a significant advantage over a mortgage in a number of important respects. In the event that the borrower fails to make their required payments on the loan, the trustee has the authority to use their right to foreclose on the property on behalf of the beneficiary.
In conclusion, A deed of trust was used in the recent purchase of a property by Elaina and Allen. Until the mortgage debt is completely paid off, a trustee will retain the title in its simplest form.
Read more about the deed of trust
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Answer:
e. Short-term debt securities such as Treasury bills and commercial paper.
Explanation:
The money market is a branch of financial markets that trade in short-term, high liquidity debt instruments. The money markets create an opportunity for investors and borrowers to buy and sell different types of short term financial securities. The short-term securities maturity period ranges from one day to less than 12 months.
The securities that trade in market markets are called money market instruments. They include commercial papers, Eurodollar deposits, treasury bills, federal agency notes, and certificates of deposit. The money markets are important because they enable companies with temporary financial shortfalls to borrow money by selling money market instruments. They also give companies with cash surplus a platform to invest and earn interests.