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Svetllana [295]
3 years ago
9

If you consider the equity of a firm to be an option on the firm’s assets then the act of paying off debt is comparable to _____

on the assets of the firm.a.purchasing a put optionb.purchasing a call optionc.exercising an in-the-money put optiond.exercising an in-the-money call optione.selling a call option
Business
1 answer:
snow_tiger [21]3 years ago
3 0

Answer: The correct option is "c.exercising an in-the-money put option".

Explanation: If you consider the equity of a firm to be an option on the firm’s assets then the act of paying off debt is comparable to <u>exercising an in-the-money put option</u> on the assets of the firm.

because he would be paying the debt with the participation in the equity of the company.

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5 0
1 year ago
Suppose Aiyanna's Pizzeria currently faces a linear demand curve and is charging a very high price per pizza and doing very litt
DedPeter [7]

Answer:

<em>Options Include:</em>

A. demand will become more price elastic.

B. price elasticity of demand will not change as price is lowered.

<em>C. demand will become less price elastic.  is Correct</em>

D. the elasticity of supply will increase.

Explanation:

<em>Typically as a broadly accurate guide, the product is called elastic if the quantity of a good demanded or purchased increases more than the change in price. </em>

(Price increases by + 5%, but demand decreases by -10%). When the shift in the purchased quantity is the same as the price change (say, 10 per cent/10 per cent= 1), the product is said to have price elasticity unit (or unitary).

Eventually, when the purchased quantity changes less than the price (say,-5 per cent demanded for a price change of+ 10 per cent), then the product is called inelastic.

7 0
3 years ago
Suppose Tim spends his entire income on hot dogs and hamburgers and consumes at least some of both. Now suppose that the price o
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Answer:

D. Tim consumes more hamburgers and fewer hot dogs.

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For his utility to remain constant, Tim will neither consume more goods in total, nor spend more money than before.

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3 years ago
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Size Up the Situation but Don't Stare. via: Pexels / cottonbro. ...

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3 years ago
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natta225 [31]

Answer:

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