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vichka [17]
3 years ago
6

Consider a stock priced at $30 with a standard deviation of 0.3. The risk-free rate is 0.05. There are put and call options avai

lable at exercise prices of 30 and a time to expiration of six months. The calls are priced at $2.89 and the puts cost $2.15. There are no dividends on the stock and the options are European. Assume that all transactions consist of 100 shares or one contract (100 options). Suppose the investor constructed a covered call. At expiration the stock price is $27. What is the investor's profit
Business
1 answer:
Elza [17]3 years ago
6 0

Answer:

-$11

Explanation:

Covered Call involves Buy stocks and Sell call options

Earning $2.89 by selling call. So, at  stock price of $27, the payoff from options is $2.89 per option

Options Profits = $2.89 * 100

Options Profits = $289

Profit of stock = ($27 - $30) * 100

Profit of stock = -$300

Investor Net Profit = Profit of stock + Options Profits

Investor Net Profit = -$300 + $289

Investor Net Profit = -$11

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Four companies were sued by customers for injuries sustained from faulty products. All four companies settled out of court for $
Anettt [7]

Answer:

d. A company with assets totaling $50 billion.

Explanation:

In order to calculate the material impact of the lawsuit on each company, we must divide the settlement by total assets. In this case, we do not need to do the math, we simply have to select which company has the most assets. The more assets a company has, the lesser the material impact of any unfavorable settlement.

4 0
3 years ago
For a given product demand, the time-series trend equation is 53 - 4 x. The negative sign on the slope of the equation:
AfilCa [17]

Answer: is an indication that product demand is declining.

Explanation:

The negative sign on the slope of the time-series trend equation simply explains that the product demand is declining.

A negative slope indicates that two variables are negatively related which implies that when the value of x increases, rhen the value of y decreases, and vice versa. When putting this in a graph, the line falls when the line that's on the line graph shifts from left to right.

The correct option is C

3 0
3 years ago
Accountants that have a Certificate in Public Accounting (CPA): a.must pass a national examination and be licensed by the state
Ostrovityanka [42]

Answer: Option A

                     

Explanation: Certified Public Accountant is an American Institute of Certified Public Accountants (AICPA) qualification for suitability in the accounting profession. The roles include financial analysis, accounting and reporting, accounting for assets, and management of treasury/cash.

Due to different rules and procedures in different states of America, the accountant must pass an examination and get license from the concerned authority if he or she wants  to practice in the state as a signatory authority.

Signatory authority refers to the ability to verify audit reports of the company.

8 0
3 years ago
If you wanted to ensure that you were able to recieve the lowest premium rate for your homeowner’s insurance, which of the follo
Zigmanuir [339]

Answer:

c

Explanation:

8 0
3 years ago
You set up an IRA with an APR of 2.5% at age 35. At the end of each month, you deposit $102 in the account. How much will the IR
Cerrena [4.2K]
The formula of the future value of annuity ordinary is

Fv=pmt [(1+r/k)^(kn)-1)÷(r/k)]
Fv future value?
PMT monthly deposits 102
R interest rate 0.025
K compounded monthly 12
N time 65−35=30 years

Fv=102×(((1+0.025÷12)^(12
×30)−1)÷(0.025÷12))
=54,607.49

Hope it helps
6 0
3 years ago
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