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
Marysya12 [62]
3 years ago
11

Assume a pension fund purchased stock at $53. Call options at a $50 exercise price presently have a $4 premium per share. The pe

nsion fund sells a call option on the stock it owns. If the call option is exercised when the price of the stock is $56, what is the gain or loss per share to the pension fund (including its gain from holding the stock as well)?
Business
1 answer:
Yakvenalex [24]3 years ago
7 0

Answer:

$1

Explanation:

Data provided in the question:

Purchasing price of stock = $53

exercise price of the stock = $50

Price of the stock = $56

Premium per share = $4

Now,

The gain is calculated as :

Gain = exercise price + Premium per share - Purchased stock  

or

Gain = $50 + $4 - $53

or

Gain = $1

Hence,

The gain per share to the pension fund is $1

You might be interested in
In a department meeting, Javier shares some research on new software he thinks the company should purchase. Roger agrees with Ja
nirvana33 [79]

Answer:

Elaborator is the correct answer.

Explanation:

In this example, Roger takes Javier's initial idea, which includes the suggestion of buying new necessary software for the company. Roger fits the description of an elaborator, who builds examples (Roger's own experience with the software and how it'd be the best option) based on initial ideas (Javier's suggestion).

3 0
3 years ago
An economist makes an assumption that each additional year of education causes future wages to rise by 7 percent. In this​ model
ladessa [460]

Answer:

Wage year 4= $12222.19

Explanation:

Giving the following information:

Each additional year of education causes future wages to rise by 7 percent.

A person with 12 years of education makes ​$21 000 per​ year.

A person with 4 years of education=$?

We will use the present value formula to calculate the wage in year 0. Then with the final value formula calculate the year 4 wage.

PV= FV/[(1+r)^n]

FV=final value at t time

r= rate

n= period of time

PV= 21000/(1,07^12)= $9324. 2511

Final Value= PV*(1+r)^t

Final Value year 4= 9324.2511*(1,07^4)= $12222.19

8 0
3 years ago
Factors that cause the rivalry among competing sellers to be weak include: Group of answer choices slow growth in buyer demand a
Airida [17]

Answer:

slow growth in buyer demand, weakly differentiated products among rival sellers.

Explanation:

There a number of causes that relate to the firms rivalry among its competitors.

1. Barriers to entry.

2. Bargaining power of the buyers.

3. Bargaining power of the suppliers.

4. Threat of substitutes.

5. Slow industry growth.

6. Lack of differentiation and switching costs.

7. Diverse competitors.

8. High strategic stakes.

7 0
2 years ago
if a bookseller buys a paperback book for 4$ and the book is labeled with a selling price of 6.99,how much is the dollar markup?
lbvjy [14]
Given:
Selling price = 6.99
Cost = 4

The dollar markup is computed by deducting the cost from the selling price.

6.99 - 4 = 2.99 is the dollar mark-up based on cost.

2.99/4 = 0.7475 x 100% = 74.75% is the percentage mark-up based on cost.

8 0
3 years ago
The slope of the budget line represents an opportunity cost​ because, moving along the​ line,
son4ous [18]
D. a consumer must give up some of one good in order to get more of the other.
7 0
2 years ago
Other questions:
  • ASK ME WEIRD QUESTIONS QUICK
    13·2 answers
  • Determine whether each consequence of poor financial decisions is an initial consequence or a long-term
    7·2 answers
  • To advertise or not to advertise Suppose that Creamland and Dairy King are the only two firms that sell ice cream. The following
    7·1 answer
  • Bryencia, a start-up media agency, has flexible work hours. The flexible work hours and leave policy at Bryencia boost employee
    6·1 answer
  • Vernon Corporation offered detachable 5-year warrants to buy one share of common stock (par value $5) at $20. The price paid for
    10·1 answer
  • According to the traditional approach to capital​ structure, the value of a firm will be maximized when​ ________. A. the financ
    6·2 answers
  • Step 8 of 8
    15·1 answer
  • One of the advantages of the Weighted Point Evaluation Method is that it: A. Keeps the number of suppliers in a Supply Chain low
    10·1 answer
  • Lester's Markets has total revenues of $3,811, costs of $2,902, depreciation of $315, interest expense of $168, and taxes of $89
    11·1 answer
  • What is application software used for?
    13·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!