Unusual loss $(300,000)
Unusual gain $700,000
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Answer:
Order size = 200 units
Number of order = 5 times
Explanation:
<em>The number of order per year will be equal to the Annual demand divided by the EOQ.</em>
<em>No of orders = Annual Demand / EOQ</em>
Economic order quantity (EOQ)
The Economic Order Quantity (EOQ) is the order size that minimizes the balance of ordering cost and holding cost. At the EOQ, the carrying cost is equal to the holding cost.
It is computed using he formulae below
EOQ = √(2× Co× D)/Ch
Ch- Carrying cost per unit per annum- $1
Co- Ordering cost per order -20
EOQ =√(2× 20× 1000)/1
= 200 units
Order size = 200 units
Number of order = 1000/200 = 5 times
If i right food water and air
The likely reason as to why the market will overproduce
goods that have external cost because of the fact that the producers experience
a lower cost compared to the society making the market produce an overproduction
of goods associated to external costs.
Answer:
Profit of 3600
Explanation:
I bought the 600 shares at a price of $41.20
so, Cost of buying the shares 24720
Along with it, i also bought the put option in $1.10 with a strike price of $45.
Buying the put option able me to sell the stock in 45 regardless of the price in stock market is.
But at the expiration date, the price of stock is $48.30 (more than strike price of $45)
So, i would not sell my stock to the broker in 45 (strike price) where, i can sell this stock in stock market at $48.30
Selling this stock in 48.30
48.30*600=28980
I must pay the option premium even though i have not utilized the option.
1.10*600=660
Finally,
selling price of shares-cost of buying shares - cost of purchasing premium
28980-24720-660= 3600
