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
kupik [55]
3 years ago
14

A U.S. firm has sold an Italian firm €1,000,000 worth of product. In one year the U.S. firm gets paid. To hedge, the U.S. firm b

ought put options on the euro with a strike price of $1.65. They paid an option premium $0.01 per euro. If at maturity, the exchange rate is $1.60,
Business
2 answers:
Paraphin [41]3 years ago
7 0

Answer:

The firm will realize $1,640,000 on the sale net of the cost of hedging.

Explanation:

Nimfa-mama [501]3 years ago
5 0

Answer:

Since the US company paid $0.01 per euro for the put option, they will receive ($1.65 - $0.01) x 1,000,000 = $1,640,000 when they execute their option. That will result in a net gain of $1,640,000 - $1,600,000 (the current exchange rate) = $40,000. Since the exchange rate was lower than the put option rate, the company was able to make a gain.

Explanation:

You might be interested in
Companies transmit over the internet because the internet ________.
Lera25 [3.4K]
<span>the answer to the question is : is inexpensive</span>
8 0
3 years ago
Merv Grazinski, driving his Winnebago, put it on cruise control to go make coffee. The Winnebago went off the road, turned over
Mars2501 [29]

Answer:

B). Contributory negligence

Explanation:

From the question we are informed about Merv Grazinski, who is driving his Winnebago, put it on cruise control to go make coffee. The Winnebago went off the road, turned over several times, and left Grazinski paralyzed from the waist down. He brings a product liability lawsuit against Winnebago. In this case, the best possible defense for Winnebago to use at trial Contributory negligence. Contributory negligence can be regarded as failure of plaintiff to have a tangible care for their own safety. Plantiff compensation could be reduced by Contributory negligence if confirmed that the occurrence of incident is likely as a result of their actions

7 0
3 years ago
What is an argument in favor of a $15 minimum wage
tamaranim1 [39]

The idea for a $15/hour minimum wage is to provide a <u>living wage</u> for employees, meaning that they can meet their basic housing, food, medical, and living expenses when working full time at minimum wage.

7 0
3 years ago
Jason is generally considered unfriendly at work, although he performs the tasks of his job very well. His supervisor rates him
Oliga [24]

Answer:

Jason's performance appraisal may be unfair due to likeability.

Explanation:

The criteria that influence Jason's evaluation are not only his accomplishments. His low rates are based on the sympathy others feel or don't feel for him, which obviously doesn't affect his productivity, effectiveness or doesn't prevent him from completing his tasks successfully. It is an unfair performance review because it is based on how the others feel about Jason and it puts aside his goals.

7 0
2 years ago
Dyer Furniture is expected to pay a dividend of D1 = $1.25 per share at the end of the year, and that dividend is expected to gr
zmey [24]

Answer:

Market price: 28.90

Explanation:

We will calculate the stock price using the gordon dividend grow model:

\frac{divends}{return-growth} = Intrinsic \: Value

D1 = 1.25

grow = g = 6% = 6/100 = 0.06

return= for the return, based on the information give, we will calculate it using the CAPM model:

Ke= r_f + \beta (r_m-r_f)  

risk free = 0.04

premium market=(market rate - risk free)= 0.055

beta(non diversifiable risk)= 1.15    

Ke= 0.04 + 1.15 (0.055)  

Ke =cost of capital = return in the dividend grow formula = 0.10325  

Now, we calculate the stock price:

\frac{1.25}{0.10325-0.04} = Intrinsic \: Value

Stock: 28.9017341

Market price: 28.90

8 0
3 years ago
Other questions:
  • Mario transferred real estate with an adjusted basis of $140,000 for similar real estate with a fair market value of $160,000. T
    15·1 answer
  • 1. Controlling is an ongoing process of
    11·2 answers
  • High and unexpected inflation has a greater cost. True or False
    15·1 answer
  • Nick's Marine Company (NMC) currently has a stock price per share of $38. If NMC's cost of equity capital (the discount rate for
    5·1 answer
  • A Giffen good is a good for which price and quantity demanded are positively related. A Giffen good arises when:_______.
    11·1 answer
  • Market performance in the United States is tracked using stock changes. which use formulas to calculate price​
    10·2 answers
  • Define direct advertising​
    10·1 answer
  • Craig is considering four loans. Loan L has a nominal rate of 8. 254%, compounded daily. Loan M has a nominal rate of 8. 474%, c
    8·1 answer
  • Select the examples of Early Childhood Development and Services workplaces. Check all that apply. A hospital a private home an o
    5·1 answer
  • If people in the military aren't included in the labor force, does the unemployment rate become a better or worse indicator of t
    8·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!