The best strategy for this trader, who wants to profit from either direction of the underlying stock, is <em>A. Long Put and C. Short Call.</em>
In securities trading, a call option gives the trader the <em>right to purchase </em>underlying security <em>without any obligation</em>. On the other hand, a put option grants the trader the <em>right to sell</em> the underlying security <em>without any obligation</em>.
Thus, the trader will profit by using options A and C.
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Answer:
a. The stock's price one year from now is expected to be 5% above the current price.
Explanation:
Under gordon model:

If we calculate the value of the stock for the year after that:

to calculate the value of the increase we divide next year over current year.

We have demostrate that next year stock should increase by 1 + growth so statement c is correct.
Answer:
General overhead= $3.81 per direct labor hour
Explanation:
Given the following information:
General Overhead $80,000 Number of direct labor hours
Number of direct labor hours 9,000 12,000= 21,000
<u>To calculate the activity rate, we need to use the following formula:</u>
Activity rate= estimated costs / total amount of allocation rate
General Overhead= 80,000 / 21,000
General overhead= $3.81 per direct labor hour
<em>MISSING INFORMATION:</em>
concept // Year 2 // Year 1
Sales 7,620 7,450
Account Receivables 655 588
Answer:
Yes, there is. The days to collect increase by 4.16 to 29.77 from 26.61
Which is a bad sing as the company delays more to collect form their customers
Explanation:
Account Receivable turnover:
Average receivable:
(458 + 588 ) / 2 = 523
7,450 / 523 = 14.25
Days to collect: 365 / 14.25 = 25,61
Second Year:
Average receivable: (655 + 588) / 2 = 621.5
Turnover: 7,620 / 621.5 = 12.26
Days to collect: 365 / 12.26 = 29,77
29.77 - 25.61 = 4.16