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Tom [10]
3 years ago
14

A share of common stock is not a derivative, but an option to buy the stock is a derivative because the value of the option is d

erived from the value of the stock. True False
Business
1 answer:
ruslelena [56]3 years ago
8 0

Answer:

True

Explanation:

Common stock such as ordinary share implies the holder has shares of ownership in a company. The holders of common stock are entitled to dividend which a share of profit of the company and the also enjoy voting rights. Common stock usually performs better than other financial investment like bonds and preferred shares and has the biggest potential for long-term gains. However, the gain usually fluctuates because will only rise if the company perform well, but the gain will fall if the performance of the company is poor. Common stocks are usually purchased through brokerages.

However, a derivative is a financial security that derives its value from an underlying asset (e.g. common stock) or group of assets (also known as a benchmark). The derivative is a contract between two or more parties and its price depends on the change in the underlying asset. Examples of underlying assets for derivatives are stocks, bonds, commodities, currencies, and among others. It is possible to buy or dell derivatives over-the-counter (OTC) or on an exchange.

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Answer with its Explanation:

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3 years ago
Ítems that can be touched used and purchased are considered to be ???
olganol [36]
B because it the right answer there
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3 years ago
What is the business owners commitment to the team during the iteration?
trasher [3.6K]
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7 0
3 years ago
A questionnaire was given to students. the first question asked was​ "how stressed have you been in the last week on a scale of
algol [13]
The question is: Which scale rating describes the greatest number of student and how many student responded with this rating.
From the frequency distribution table attach to the question, the scale rating with the highest number of student is  7 out of 10 and the number of students that responded with this rating is 27 students.
7 0
3 years ago
Parent Co. invested $1,000,000 in Sub Co. for 25% of its outstanding stock. Sub Co. pays out 40% of net income in dividends each
yawa3891 [41]

Answer:

(A) $110,000

(B) $44,000

(C) $440,000

(D) $176,000

Explanation:

Parent corporation invested $1,000,000 in sub corpora tion for 25% of its outstanding stock

Sub corporation pays out 40% of net income of dividend each year

(A) Parent's Co's share of Sub's Co's net income for the year is $110,000

(B) Parent's Co's share of Sub's Co's share of dividend for the year is $44,000

(C) The total net income can be calculated as follows

= 110,000 ×100/25

= 11,000,000/25

= $440,000

(D) The total dividend for the year can be calculated as follows

= 440,000 ×40/100

= 440,000 × 0.4

= $176,000

5 0
3 years ago
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