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mart [117]
3 years ago
11

"DEF Corporation, after many profitable years, declares a one-time special cash dividend of $5.00 per share. After the announcem

ent, the stock is trading at $50 per share. Your customer holds 1 DEF Jan 55 Call. As of the ex date, the customer will have:"
Business
1 answer:
Tju [1.3M]3 years ago
8 0

Answer: B. 1 DEF Jan 50 Call

Explanation:

The Options Clearing Corporation (OCC) acting under its mandate of being an issuer and guarantor for options and futures contracts can alter options prices but does not do so for prices based on normal dividends as they are more regular and their effects are already accounted for in the price of the call.

When a company calls a one-time special cash dividend, this is new to the market which would not have incorporated it into the price of the call. The OCC will then adjust the price to account for this.

In this case it will do so by subtracting the dividend from the call;

= 55 - 5

= $50

The customer will then have 1 DEF Jan 50 Call .

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In one paragraph, list and describe the three major effects of inflation on the economy
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3 years ago
Defined cost object?<br>​
Sergeu [11.5K]

Answer:

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Explanation:

4 0
3 years ago
Read 2 more answers
indicate whether the following statement is true or false and why." a wage rising slower than the rate of inflation is actually
Artemon [7]

Answer:

The correct answer is option c.

Explanation:

Inflation implies an increase in the general price level. It reduces the purchasing power of consumers.  

If the wages are increasing slower than the rate as inflation it means that the disposable income is increasing at a slower rate than the increase in prices. It implies that purchasing power is declining.  

If wages are increasing at the same rate as inflation, it means that the purchasing power is constant. If wages are increasing at a faster rate than the increase in the inflation rate, it means that the purchasing power is increasing.

6 0
3 years ago
Suppose a firm doubles its inputs (therefore doubling its total costs as well). If this firm is experiencing diseconomies of sca
inn [45]

Answer:

<h2>Under diseconomies of scale,firms experience decreasing returns to scale.Hence,the answer would be option B. or output will increase but less than double.</h2>

Explanation:

  • Diseconomies of scale is characterized as a situation in production where any firm experiences increase in the average cost of production as the output or production level expands.
  • Diseconomies of scale can occur when the productive resources of the factors/inputs of production looses their productive efficiency in the production process and is not able to generate proportionate or higher production level or output.
  • As a result,the output or production level obtained by employing a certain level of factor inputs or productive resources is usually less than the amount or proportion of those factor inputs or resources.
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5 0
3 years ago
Hsung Company accumulates the following data concerning a proposed capital investment: cash cost $175,846, net annual cash flows
Luba_88 [7]

Answer:

11400

the investment should be made because NPV is positive

Explanation:

Net present value is the present value of after-tax cash flows from an investment less the amount invested.

NPV =( Net annual cash flows x present value factor)  - cost

(37300 x 5,02 ) - $175,846 = 11400

5 0
3 years ago
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