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Vanyuwa [196]
3 years ago
11

Michael Jordan purchases (long) 10 shares of XYZ stock for 23.00 per share. Six months from now he will sell all 10 shares. The

continuously compounded risk free rate is 5%.
A. What is the breakeven stock price at the end of six months?
B. What is his profit if the stock price at the end of six months is 23.80 per share?
Business
1 answer:
melamori03 [73]3 years ago
3 0

Answer:

a) Breakeven price = Purchase price + Interest amount that would have been earned on the invested amount

Breakeven price = 23 + [23*e^(0.05*1/2) - 23]

Breakeven price = 23 + 0.5822477721

Breakeven price = $23.5822477721

b) Profit = Selling price - Breakeven price

Profit = $23.80 - $23.5822477721

Profit = $0.2177522279 per share

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Morgarella [4.7K]

Based on the payment you can afford, the interest rate, and the number of years, the loan you can afford is $6,774.15

<h3>What size of a loan can you afford?</h3>

First find the monthly interest rate:

= 4% /12

= 1/3%

Number of periods:

= 3 x 12

= 36 months

The loan you can afford can be found as:

= Payment x ( 1 - (1 + rate) ^ -number of periods) / rate

= 200 x (1 - (1 + 1/3%)⁻³⁶) / 1/3%
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Find out more on loans at brainly.com/question/15088278.

4 0
3 years ago
Raymond owns an orchard. He has found that his distribution network is strongest in Mexico, and that is where he makes the most
Keith_Richards [23]
C. arrange for retailers to pick up the fruits
5 0
3 years ago
In a college-level course, Mrs. Smith gives the lectures, sets the due dates, and is the expert on the material. Mr. Doe helps g
Cerrena [4.2K]

Answer:

Mrs. Smith is a postsecondary teacher, and Mr. Doe is a teaching assistant.

Explanation:

Mrs. Smith gives the lectures, sets the due dates, and is an expert on the material of a <em>"college-level course"</em>, therefore, she has to be a postsecondary teacher, as the teacher is responsible for giving the lectures, and has to be an expert on the material.

<em />

Mr. Doe helps grade papers, offers tutoring sessions for the students, and attends the lectures. From my experience and the phrase <em>"helps grade papers" </em>rather than just <em>"grades the papers", </em>we can conclude that Mr. Doe is the teaching assistant. <em> </em>

7 0
3 years ago
Lewis company has $25,000 in retained earnings, $40,000 in assets, and $11,000 in liabilities. how much is in common stock?
Nimfa-mama [501]
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6 0
4 years ago
Informal labor is part of every country's economy.
mixas84 [53]

Answer:

The choices provided are:

True or False.

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Therefore we can conclude that informal labor is part of every country's economy. Their activities may not be included in the calculation of GDP but it is well known to the Government that informal labor exists. The Government knows that people are engaged in one small business or the other as a means of making a living and also a way to avoid committing crimes to make ends meet.

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