The call in this scenario is known as Out of the money (OTM).
Out of the money is when an option has no intrinsic value but rather, has an extrinsic value.
- Here, the current stock price is below the strike price of 201,then, we say that the call is out of money.
- A call option is called Out of the money when the underlying price is trading below the strike price of the call.
Hence, the call in this scenario is known as Out of the money (OTM)
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Original price = $500
Assume that the tax rate is 8%
Cost of the TV plus tax = 500*1.08 = $540
Worth of the 25% coupon = 0.25*540 = $135
Reduced price = 540 - 135 = $405
The cost of the TV with a coupon for 25% off excluding tax is $405.
Answer: $405
Answer:
TR decreases if Demand is Elastic, TR increases if Demand is Inelastic
Explanation:
Price Elasticity of Demand is the responsive change in price, due to change in price. Elastic demand means demand responds more to price change, Inelastic demand means demand responds less to price change. Total Revenue is the total receipt value from sales = Price x Quantity
- If demand is elastic : price & total revenue are inversely related - price increase, demand decrease & price decrease, demand increase.
- If demand is inelastic : price & total revenue are directly related - price increase, demand increase & price decrease, demand increase
So, If a company increases its sale price per unit of a product :
- Total Revenue would increase as a result of price rise, if demand is Inelastic
- Total Revenue would decrease as a result of price rise, if demand is Elastic
I cannot see the questions can you please get closer
I think it’s false because no one was buying anything during the depression