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katen-ka-za [31]
3 years ago
6

A customer has a fully paid options position and is long marginable stock. Subsequently he receives a margin call on his long st

ock position. Which of the following statements are TRUE?
I The customer can borrow against long options contracts to satisfy a portion of the margin call
II The customer cannot borrow against the long options contracts to satisfy the margin call
III Long option contracts have a loan value of 0%
IV Long option contracts have a loan value of 50%

a. I and III
b. I and IV
c. II and III
d. II and IV
Business
1 answer:
Feliz [49]3 years ago
8 0

Answer: II and III

Explanation:

From the question, we are informed that a customer has a fully paid options position and is long marginable stock and that subsequently he receives a margin call on his long stock position.

The statements that are true are that the customer cannot borrow against the long options contracts to satisfy the margin call and the long option contracts have a loan value of 0%.

Therefore, option C is the right answer.

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2 years ago
Michael Peters is a middle-aged professional who lost his job five months ago when his former employer downsized. He’s been ac
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Answer: necessity entrepreneur

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3 years ago
At the beginning of his current tax year, David invests $13,410 in original issue U.S. Treasury bonds with a $10,000 face value
vagabundo [1.1K]

Answer:

The amount of income that David will report this year if he elects to amortize the bond premium is $455.94.

Explanation:

This can be calculated as follows:

Interest income = Carrying value of the bond * Yield to maturity…………….. (1)

Where;

Carrying value of the bond = $13,410

Yield to maturity = 3.4%

Substituting the values into equation (1), we have:

Interest income = $13,410 * 3.4% = $455.94

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3 years ago
Economists use the distinction between private and public goods to determine __________
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2 years ago
On January 1, 2021, Consolidated Company purchased 100% of the common stock Avergy Industries for $720,000. On that date, Avergy
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Answer:

b. $ 50,000

Explanation:

Investment cost                    

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Book value of net asset

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420000

--------------

520000

Excess

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Allocated as follows

Land and equipment                              50000

overvaluation of bonds payable            40000

Undervaluation of inventory                    60000

Total                                                          150000

Un allocated amount    

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Total                                                        200000

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