Answer:
Using put call parity:
C + X/(1+r)^n = S+P
C + 18/(1+0.08)^1 = 20+3.33
C + 18/1.08 = 20 + 3.33
C + 18/1.08 = 23.33
C + 16.67 = 23.33
C = 23.33 - 16.6667
C = 6.67
The call price ($7) is over price, so we should sell call and buy underlying ($6.67). After one year, the underlying option will get a gain of $0.33 ($7-$6.67). So, we should exploit this arbitrage opportunity.
Answer:
$4,030
Explanation:
Social Security tax is the tax levied on both employers and employees to fund the Social Security program. The total for the social security tax is 12.4%, so the employees and employers divides it equally among themselves which gives 6.2% each.
So the total amount of tax I will responsible to pay at then end of the first service year will be
= 6.2% * $65000
= $4,030
While the Employer will pay the other part
Answer:
A. Coincident indicator
Explanation:
Option B is not the answer as the lagging indicator is the occurrence after the target variable has associated with the economy.
Option C is not the answer as the leading indicator is the changes before the beginning of the economic factor. It means it predicts economic activities.
Option D is not an economic indicator, so it is incorrect.
<em>Option A</em> is the answer because the employment rate and interest rate are examples of the coincident economic indicator. It occurs when both factors occur at the same time. It also suggests the current state of an economy.
168,000 is amount of the gain is Ethan allowed to exclude from his gross income
Solution:
Ethan's post 2009 non-qualified use is 2 years.
He owned the property for 10 years so he is not allowed to exclude 20% of the gain
= $210,000 × 20% = $42,000
He is allowed to exclude = ($210,000 - $42,000)
= $168,000
Answer:
The correct answer is A.
Explanation:
Giving the following information:
During the year, 200,000 picture frames were produced.
Materials and labor standards for producing the picture frames are as follows:
Direct labor (2 hours e $12)
Its actual labor hours were 320,000 hours at a wage rate of $13.
We need to use the following formula:
Direct labor rate variance= (Standard Rate - Actual Rate)*Actual Quantity
Direct labor rate variance= (12 - 13)*320,000= $320,000 unfavorable