Answer:
$34
Explanation:
The minimum price to accept for the special order is the one that takes into consideration the cost of buying imprinting machine at the cost of $60,000.
The minimum price would contain variable cost of $10,fixed production cost of $18 ,$0 variable selling cost but includes $6 per unit of the imprinting machine cost i.e $60,000/10,000
The cost sums to be $34 i.e $10+$18+$0+$6.
The fixed cost per unit would also have been excluded if it was confirmed that the company has idle capacity
According to the midpoint method, the price elasticity of demand for tomatoes between point X and point Y is approximately (1.8 or 0.56 or 0.09 or 0.05) , which suggests that the demand for tomatoes is (elastic or
Answer:
$13.89
Explanation:
The computation of the value of stock is shown below:
Year Dividend Present value factor at 16% Present value
1 $1.90 0.862 $1.64
2 $2.10 0.743 $1.56
3 $2.30
Price $14.375 0.743 $10.68
The price is computed below:
= $2.30 ÷ 16% = $14.375
Total present value $13.89
The present value factor is computed below:
= 1 ÷ (1 + rate) ^ years
For Year 1 = 1 ÷ 1.16^1 = 0.862
For Year 2 = 1 ÷ 1.16^2 = 0.743
Answer:
$5.76
Explanation:
Calculation to determine the price of a put option with the same exercise price
We would be Using put-call parity and solving for the put price
$67 + P = $70e^–(.026)(3/12)+ $3.21
$67 + P = $70e^–(.026)(.25)+ $3.21
$67 + P =190.2797^–(0.0065)+ $3.21
$67 + P =$69.5465+ $3.21
$67 + P =$72.7565
P=$72.7565-$67
P=$5.7565
P=$5.76 (Approximately)
Therefore the price of a put option with the same exercise price will be $5.76
Answer: 1.20
Explanation:
The Portfolio beta will be a weighted average of the individual stock betas.
Portfolio beta = (22% * 0.88) + ( 23% * 0.94) + ( 42% * 1.34) + ( 13% * 1.79)
= 0.1936 + 0.2162 + 0.5628 + 0.2327
= 1.2053
= 1.20
