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Bess [88]
3 years ago
9

The current stock price of Alcoco is $70, and the stock does not pay dividends. The instantaneous risk-free rate of return is 6%

. The instantaneous standard deviation of Alcoco's stock is 40%. You want to purchase a call option on this stock with an exercise price of $75 and an expiration date 30 days from now. Based on the Black-Scholes OPM, the call option's delta will be __________.
Business
1 answer:
Mashutka [201]3 years ago
3 0

Answer:

0.31

Explanation:

current stock price $70

risk free rate = 6%

standard deviation = 40$

30 day call option $75

the simplest way to calculate delta (or stock position) is to use a scientific calculator, but if you want you can also do it manually:

delta = N(d₁) ⇒ cumulative normal distribution probability at d₁

with d₁ = [ln (S/K) + (r2  + σ ²/2)T] / σ√T

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LO 1.2Who are the primary users of the information gathered by managerial accountants?
Oduvanchick [21]

Answer:

managers of the organization

Explanation:

Management Accounting - The main purpose of accounting is to provide a database for business leaders to make the right decisions. Management accounting performs the same function as an area of ​​accounting. Simply the information that the management accounting reveals is intended for internal users of the enterprise, and some literature has described it as "good" data.

Internal users use management accounting data to develop strategies, plan work, make decisions, and optimize resource use.

The main differences between the Financial Accounting (FA) and the Management Accounting (MA) are the dual registration system in the FA. The FA should comply with the legislation and the monetary measure. MA has no legal requirement, and natural, labor and so on. Dimensions can be used. One of the most important differences is that the FA reflects on what has happened, and MA prepares predictive reports on what has happened and about future events.Thus, MA calculations help in making decisions on internal procedures, budgeting and other projected reports.

4 0
3 years ago
_____ is a law that requires ceos and cfos to vouch personally for the truthfulness and fairness of their firms' financial discl
Nikitich [7]

The Sarbanes-Oxley Act requires both CEOs and CFOs to personally vouch for the reported financial earnings of a company. This law was passed shortly after the Enron scandal.

3 0
4 years ago
As a project manager for Office Green, you are responsible for consulting with team members to identify potential risks for the
oksian1 [2.3K]

The main risks types that need to plan for in the project are the systematic and unsystematic risk.

<h3>What is a project?</h3>

It should be noted that a project simply means the activity that's engaged in to achieve a particular goal.

In this case, the main risks types that need to plan for in the project are the systematic and unsystematic risk.

Learn more about projects on:

brainly.com/question/6500846

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5 0
2 years ago
The manager for a growing firm is considering the launch of a new product. If the product goes directly to market, there is a 40
julia-pushkina [17]

Answer:

1. Calculate the NPV for each option available for the project. (Do not round intermediate calculations. Enter your answers in dollars, not millions of dollars, e.g. 1,234,567.)

  • go to market now = $744,000
  • focus group = $852,000
  • consulting firm = $916,000

2. Which action should the firm undertake?

  • A. Consulting firm

The NPV is higher than the rst of the options.

Explanation:

expected payoffs:

  • option 1 (go to market now) = (40% x $1.86 million) + 0 = $744,000
  • option 2 (focus group) = (55% x $1.86 million) + 0 = $1,023,000
  • option 3 (consulting firm) = (70% x $1.86 million) + 0 = $1,302,000

expected NPVs:

  • option 1 (go to market now) = $744,000
  • option 2 (focus group) = $1,023,000 - $171,000 = $852,000
  • option 3 (consulting firm) = $1,302,000 - $386,000 = $916,000

go to market now

5 0
3 years ago
What is the future value of $15,000 received today if it is invested at 7.5% compounded annually for five years
Firlakuza [10]

Answer:

the future value is $21,534.44

Explanation:

The computation of the future value is shown below:

As we know that

Future value = Present value × (1 + interest rate)^number of years

where,  

Present value is $15,000

The Interest rate is 7.5%

And, the number of the year is 5 years

Now put these values to the above formula

So, the future value is  

= $15,000 × (1 + 0.075)^5

= $21,534.44

Hence, the future value is $21,534.44

6 0
4 years ago
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