1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
sukhopar [10]
3 years ago
11

The price of a stock on February 1 is $48. A trader sells 200 put options on the stock with a strike price of $40 when the optio

n price is $2. The options are exercised when the stock price is $39. The trader's net profit or loss is
Business
1 answer:
gizmo_the_mogwai [7]3 years ago
3 0

Answer:

$200

Explanation:

Given that,

Price of a stock on February 1 = $48

Trader sells = 200 put options

Strike price = $40

Option price = $2

Options are exercised when the stock price = $39

Net profit (Loss):

= Stock price - Strike price + Premium

= $39 - $40 + $2

= $1

The net gain for one put option is $1.

Therefore, the total net gain for 200 put options is as follows:

= 200 × $1

= $200

Hence, the trader's net profit is $200.

You might be interested in
Ahmad bought a desktop computer and a laptop computer. Before finance charges, the laptop cost less than the desktop. He paid fo
deff fn [24]

Answer:

cost of laptop = $1,800

cost of desktop = $2,100

Explanation:

From the question above, we can see that the laptop costs $300 less than the desktop, therefore, we say:

let x represent the cost of the laptop ;

then x+300 will be the cost of the desktop .

We can also see that the total finance charge of $252 is equal to 7% of the cost of the laptop and 6% of the cost of the desktop, we solve as follows:

252 = 0.07(x) + 0.06(x + 300)

252 = 0.07x + 0.06x + 18

252 - 18 = 0.13x

234 = 0.13x

x = 234/0.13

x = 1,800

Recall that:

cost of desktop = x + 300

therefore:

1,800 + 300 = 2,100.

cost of laptop = $1,800

cost of desktop = $2,100

6 0
3 years ago
Read 2 more answers
Describing a topic, idea, or concept you find so engaging that it makes you lose all track of time. Why does it captivate you? W
Alenkasestr [34]

Answer:

Strategic Warfare

Explanation:

The objective behind strategic warfare is to utilize infantry, artillery, naval forces and air defense to give a massive blow to the enemy. It’s about using all these military divisions to complement each other, advance across terrains, weaken enemy defense and surge into their territory.  

Its mesmerizing as it is a lethal combination of art and skill. The complexity and resilience of warfare coupled with the use of technology to surprise the enemy, is what amaze me. I turn to documentaries, books, news and even conversations with war veterans.  

Recently I am watching a documentary comprising major events of World War 2, on Netflix. I often visit museums to study memoirs and the history behind them. I often talk to my grandparents and their friends who were directly or indirectly involved with war or any other combat.

5 0
3 years ago
Which section of a research poster or paper allows other scientists to repeat an experiment?
Triss [41]
The <span> section of a research poster or paper that allows other scientists to repeat an experiment is: The method sections
In method sections, a researcher could write a thorough explanation on how he/she conducted the experiment. It's being done so the readers could check the validity of the results</span>
7 0
3 years ago
Which is not something you should look for in a saving account?
pshichka [43]

Answer:

You should make sure you are putting money into it every week, month, or year.

Explanation:

You must make sure you have enough money in the account so if you have some kind of an injury, or you want to buy something that costs lots of money such as a car, or a house, you want to make sure enough money is going into that account.

6 0
3 years ago
Nancy has a portfolio of two stocks. Stock A has an expected return of 8% and stock B has an expected return of 10%. Her funds a
dedylja [7]

Answer:

b. 8.92%

Explanation:

Calculation for the portfolio expected return

Using this formula

Portfolio expected return = (Stock A allocated fund x Stock A expected return) + (Stock B allocated fund x Stock B expected return)

Let plug in the formula

Portfolio expected return= (54%*8%) + (46%*10%)

Portfolio expected return=0.0432+0.046

Portfolio expected return=0.0892*100

Portfolio expected return =8.92%

Therefore the portfolio expected return will be 8.92%

7 0
3 years ago
Other questions:
  • In thinking about the "color of money," which color would correspond to a new video game system charged on a credit card when yo
    5·2 answers
  • What is market segmentation? List the steps in the market segmentation process.
    15·1 answer
  • Mr. X finds it hard to dine with his american colleagues as his religion prohibits the consumption of pork and alcohol. He also
    14·1 answer
  • In the case of such a catastrophe like the one we are facing (corona
    14·1 answer
  • Retained earnings Group of answer choices is unique to the corporate form of business. is an optional account in the partnership
    6·1 answer
  • Name three tasks a military police personnel stationed at a detention facility might be responsible for on any given day.
    6·1 answer
  • Waterloo, Ltd. manufactures a component used in aircraft navigation systems. Demand has been strong and the executive staff at W
    7·1 answer
  • What is one counter-argument to the premise that the wealth gap is a serious problem which needs to be addressed? the lower clas
    7·1 answer
  • Which of the following is an example of a human resource?
    10·1 answer
  • As a recently hired financial analyst, you have been asked to analyze the efficiency with which Caterpillar has been managing it
    5·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!