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
Veronika [31]
3 years ago
14

The potential loss for a writer of a naked call option on a stock is Multiple Choice increasing when the stock price is decreasi

ng. unlimited. None of the options are correct. equal to the call premium. limited.
Business
1 answer:
jok3333 [9.3K]3 years ago
3 0

Answer:

The correct answer will be Option A (unlimited).

Explanation:

  • The potential loss which always relies on something like a potential occurrence happening or otherwise not happening. One such loss to such a writer's exposed put option on either a stock seems to be indefinite or unlimited.
  • Unless the loss becomes probable as well as the sum could be calculated, the damage including responsibility must be reported with either the journal entry.

Other available scenarios aren't connected to the situation in question. So alternative A, therefore, the perfect solution.

You might be interested in
The premium on a put option on the market index with an exercise price of 1050 is $9.30 when originally purchased. At expiration
lianna [129]

Answer:

The put payoff = $1,072 - $1,050 = $22  per share

Explanation:

The put payoff is simply the difference between the spot price and the exercise price.

To determine the real profit obtained in this transaction we would need to know the investor's return rate. One of the basic pillars in finance it that $1 today is worth more than $1 tomorrow. We need a return rate to adjust the premium paid, for example if the return rate = 6%, then the premium would have been $9.30 x (1 + 6%/12)² = $9.30 x 1.005² = $9.39

profit = number of shares x (put payoff - adjusted premium)

5 0
3 years ago
Winnebagel Corporation currently sells 28,000 motor homes per year at $84,000 each and 7,000 luxury coaches per year at $135,000
MissTica

Answer:

$825,050,000

Explanation:

Calculation to determine the amount to use as the annual sales when evaluating this project

First step is to calculate the new product line sales

New product line sales =29,000*$24,700

New product line sales = $716,300,000

Second step is to calculate Increased sales of the motor home line

Increased sales=2,500*$84,000

Increased sales = $210,000,000

Third step is to calculate the loss in sales

Loss in sales=750*$135,000

Loss in sales= $101,250,000

Now let calculate the amount to use as the annual sales when evaluating this project

Net sales = $716,300,000 + $210,000,000 - $101,250,000

Net sales = $825,050,000

Therefore the amount to use as the annual sales when evaluating this project is $825,050,000

4 0
3 years ago
How is the law of increasing costs similar to the concept of decision making at the margin?
amm1812
Helpppp usssss plzzzzzzzzzzzzzzzz
3 0
3 years ago
The _____ of an organizational life cycle is characterized by growth and the expansion of organizational resources.
Verizon [17]

Answer: The _youth_ of an organizational life cycle is characterized by growth and the expansion of organizational resources.

Explanation:

7 0
2 years ago
Consider the following list of accounts: Cash Retained Earnings Service Revenue Utilities Expense Salaries Expense Accounts Rece
MAVERICK [17]

Answer:

Cash, account receivable, equipment, utilities expenses, salaries expense

Explanation:

Normally, the asset and expense accounts have debit balances while the liabilities, equity, revenue and other income accounts have credit balances.

In the given list of account:

Cash, account receivable, equipment belong to asset accounts, therefore will have normal debit balance.

Utilities expenses, salaries expense belong to expense accounts, therefore will have normal debit balance.

Remaining items in a given list will have normal credit balance.

4 0
3 years ago
Other questions:
  • Shelton Co. purchased a parcel of land six years ago for $877,500. At that time, the firm invested $149,000 in grading the site
    5·1 answer
  • Desertification is thought to be principally due to
    8·1 answer
  • Spot Co. purchases office supplies from Sally Supplies, Inc.. Spot does not pay cash for the purchase, and now owes the amount t
    13·1 answer
  • Luxury items in a budget come from _____. A. an income B. a deficit C. fixed expenses D. savings
    12·2 answers
  • Below is Salem Company’s income statement for 2019 that was prepared by an inexperienced accountant.
    12·1 answer
  • You arrive at the local convenience store to find out that a robbery has just occurred. The store clerk appears to have been sta
    9·2 answers
  • The concept of market efficiency underpins almost all financial theory and decision models. When financial markets are efficient
    9·1 answer
  • Suppose Jose splits his spending across scones and coffees. Due to droughts in coffee-producing regions, the price of coffee dou
    13·1 answer
  • Hot Topic has a policy of promoting from within. If Hot Topic uses clearly defined selection criteria and a transparent process,
    9·1 answer
  • Please help
    10·2 answers
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!