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
Viktor [21]
3 years ago
5

A grain elevator operator bought a futures contract for 5,000 kilograms of rice at $1.50 per kilogram. The initial margin is $4,

000 and the maintenance margin is $2,000. (a) What change in (i) balance of margin account and (ii) price per kilogram will lead to a margin call? (b) Calculate the price per kilogram at which the margin call will be issued. (c) Calculate change in (i) balance of margin account and (ii) price per kilogram at which $2,000 could be withdrawn from the margin account. (d) Calculate the price per kilogram at which $2,000 could be withdrawn from the margin account.
Business
1 answer:
Inessa05 [86]3 years ago
3 0

Answer:

Given that,

Operator bought a futures contract = 5,000 kilograms of rice at $1.50 per kilogram

Initial margin = $4,000

Maintenance margin = $2,000

(a)

(i) Balance of Margin = Initial margin - maintenance margin

                                  = $4,000 - $2,000

                                  = $2,000 (loss)

(ii) Change in price = \frac{2,000}{5,000}

                               = $0.40

(b) Price per kilogram = Current price - Change in Price

                                     = $1.50 - $0.40

                                     = $1.10

So, change price per kg is $1.10

(c) Balance of Margin = Initial margin - maintenance margin

                                  = $4,000 + $2,000

                                  = $6,000 (loss)

Change in price = \frac{2,000}{5,000}

                               = $0.40

(d) Price per kg = Current price - change in price

                          = $1.50 + $0.40

                          = $1.90

You might be interested in
Amazon Prime, briefly mentioned in the case, is a subscription service that gives members free two-day shipping on hundreds of t
Leto [7]

Cheaper pricing, more attractive loyalty programmes, more convenient delivery options and better product range.

Explanation:

A website asked participants how much their average spending online is invested. Results suggest Amazon Prime subscribers buy more money overall; U.S. Prime affirms doing 53 percent of their online shopping, while Non-Prime members invest 50 percent in the United Kingdom.

As internet customers in general, they spoke to Prime members about Amazon being too strong, with 61% of British members and 69% of American Prime members claiming that they are worried with Amazon's increasing and stifling competition. Amazon is a big player.

The main reasons they asked for Amazon were: lower prices, more loyalty rewards, more flexible shipping choices and better product selection.

Prime Members quoted the main reasons they should choose another store over Amazon. In the United States 26% and in the United Kingdom 18% have reported that they enjoy interactions in-store.

4 0
3 years ago
" what demographic and psychographic changes are creating business opportunities for new ventures
kkurt [141]
A major one is the increase in globalization.

now a days people can talk to anyone in any part of the world at any time they want for free and within an instant of when they think of it. Bills and payments can be made from the tap of a button. Someone can stay in their house there entire life and have everything they ever needed. this is being translated to the business world in massive ways.
4 0
3 years ago
Three months of rent were prepaid on May 1 for $7,200, but two months have now expired, leaving only one month prepaid at June 3
Dafna11 [192]

Answer:

b- $2,400

Explanation:

The computation of the amount that should be recorded is given below:

= 3 months rent ÷ number of months

= $7,200 ÷ 3 months

= $2,400

Hence, the amount of rent that should be recorded is $2,400

Therefore the option b is correct

The same should be considered

7 0
3 years ago
On June 15, Harper purchased equipment for $100,000 from Imperial Corp. and signed for the goods as President of the company. He
Ivenika [448]

<u>Full question:</u>

On June 15, Harper purchased equipment for $100,000 from Imperial Corp. for use in its manufacturing process. Harper paid for the equipment with funds borrowed from Eastern Bank. Harper gave Eastern a security agreement and financing statement covering Harper’s existing and after-acquired equipment. On June 21, Harper was petitioned involuntarily into bankruptcy under Chapter 7 of the Federal Bankruptcy Code. A bankruptcy trustee was appointed. On June 23, Eastern filed the financing statement. Which of the parties will have a superior security interest in the equipment?

A. The trustee in bankruptcy, because the filing of the financing statement after the commencement of the bankruptcy case would be deemed a preferential transfer.

B. The trustee in bankruptcy, because the trustee became a lien creditor before Eastern perfected its security interest.

C. Eastern, because it had a perfected purchase money security interest without having to file a financing statement.

D. Eastern, because it perfected its security interest within the permissible time limits.

<u>Answer:</u>

Eastern parties will have a superior security interest in the equipment because it perfected its security interest within the permissible time limits.

<u>Explanation:</u>

Eastern has a higher security interest because Eastern amended its security interest inside the allowable time deadlines. A perfected security interest in any security interest in an asset that cannot be demanded by any other party.  

Below the Uniform Commercial Code (U.C.C.), to perfect a security interest, a lender has 10 days from the date of the sale of material to perfect the security interest by filing a financing statement.  Possessing registered in the 10-day limit, Eastern has a strong perfected security interest in the material and after-acquired things even though the bankruptcy was recorded two days ahead.

6 0
3 years ago
You make $45,000 per year at your current job with Whiz Kids Consultants. You are considering a job offer from Brainiacs, Inc.,
DIA [1.3K]

Answer:

(a) Yes. It is an opportunity cost of new job because the additional time he spent commuting is a cost, as he can utilize that time in doing something else.

(b) Yes. It is also an opportunity cost because if a person wants to join a new job then he have to give up his current job. So, the earning of $45,000 from his current job is the opportunity cost of accepting the new job.

(c) No. It is not an opportunity cost but it is an additional benefit from the new job because he is not sacrificing anything to obtain this benefit.

5 0
3 years ago
Other questions:
  • A major difference between a business plan and a marketing plan is that a business plan will include ________ while a marketing
    5·1 answer
  • Stanley Corporation manufactures an electronic switch for dishwashers. The cost base per unit, excluding selling and administrat
    10·1 answer
  • Decision-Making Styles. When making decisions, individuals often display a personal style that reflects how they perceive what i
    5·1 answer
  • Ryngaert Inc. recently issued noncallable bonds that mature in 15 years. They have a par value of $1,000 and an annual coupon of
    10·1 answer
  • _______ is not considered to be a "developing" nation. A. Brazil B. India C. China D. Japan E. Mexico
    10·1 answer
  • What macroeconomic goal is Real GDP used to measure for?
    12·1 answer
  • One of the safest and easiest investments for young people is: A Stocks and Bonds. OB. Mutual funds. OC. NCUA or FDIC Insured ce
    11·1 answer
  • According to the law of supply - as the price of a good - service - or resource rises:______.
    11·1 answer
  • To measure the trends of the market area, the appraiser must ask questions about ______________________.
    13·1 answer
  • What is the overall purpose of strategic management? multiple choice question. gain competitive advantage
    12·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!