Answer:
Step-by-step explanation:
An option to buy a stock is priced at $150. If the stock closes above 30 next Thursday, the option will be worth $1000. If it closes below 20, the option will be worth nothing, and if it closes between 20 and 30, the option will be worth $200. A trader thinks there is a 50% chance that the stock will close in the 20-30 range, a 20% chance that it will close above 30, and a 30% chance that it will fall below 20.
a) Let X represent the price of the option
<h3><u> x P(X=x)
</u></h3>
$1000 20/100 = 0.2
$200 50/100 = 0.5
$0 30/100 = 0.3
b) Expected option price

Therefore expected gain = $300 - $150 = $150
c) The trader should buy the stock. Since there is an positive expected gain($150) in trading that stock option.
Answer:
I'm not sure, you posted this like a longggggg time ago so we're good. bye. hope i helped.
Step-by-step explanation:
Answer:
See below
Step-by-step explanation:
To graph the line we need two points, one point is the y-intercept, the second point to be calculated.
Q7
<u>y = -3x + 6</u>
- The y-intercept is (0, 6)
<u>Let the domain be x = 5 for the second point, then:</u>
- y = -3*5 + 6 = -15 + 6 = -9
- The point is (5, -9)
Connect these points to get the graph
Q8
<u>y = 4/5x - 3</u>
- The y-intercept is (0, -3)
<u>Let the domain be x = 5 for the second point, then:</u>
- y = 4/5*5 - 3 = 4 - 3 = 1
- The point is (5, 1)
Connect these two points to get the graph
Answer:
1. A=56.25
Step-by-step explanation:
sry but i dont know the answer to six