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QveST [7]
2 years ago
8

Steve has an option with a payoff profile that depicts a line that is constant at zero up until some point after which the line

slopes downward. What type of action did Steve take to obtain this profile?
a. Purchased a call option
b. Purchased a put option
c. Sold a call option
d. Sold a put option
e. Purchased and simultaneously sold the same call option
Business
1 answer:
ICE Princess25 [194]2 years ago
4 0

Answer:

D) Sold a call option

Explanation:

From the question, we are informed about Steve, who has an option with a payoff profile that depicts a line that is constant at zero up until some point after which the line slopes downward. In this case the type of action did Steve take to obtain this profile is Sold a call option.

a call option can be regarded as a kind of derivatives contract that enable the a call option for those that want to purchase stock or financial instrument the right to buy it at a specific price but not obligation. When a call option is sold, then the buyer is given the opportunity to buy the stock at a particular price with expeiration. The price is known as "strike price".

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A company manufactures various sized plastic bottles for its medicinal product. The manufacturing cost for small bottles is $67
VLD [36.1K]

Answer:

The company should buy from an outside source rahter than manufacturing because each bottle manufactured costs $5 more.

Explanation:

Differential Analysis

                                                          Make            Buy

Manufacturing Cost per bottle         $ 67

Purchasing Cost per bottle                                  $35

Freight per bottle                                                  $ 5

<u>Fixed Costs                                                            $ 22   </u>

<u>Total                                                   $ 67              $62   </u>

<u />

The company should buy the bottles from the  outside source because the manufacturing costs are higher than the purchasing costs and the fixed costs.

The fixed costs are the irrelevant costs that will continue whether bottles are manufactured or purchased.

6 0
2 years ago
Bad Debts account has a credit balance of $8,000 before the adjusting entry for bad debts expense. After analyzing the accounts
White raven [17]

Answer:

$14,300

Explanation:

Based on the information given we were told that the​ management of the company estimated that the amount in the uncollectible accounts will be the amount of $14,300 which means that the amount of $14,300 will be the balance of the Allowance for Bad Debts that should be reported on the company balance​ sheet.

5 0
3 years ago
Imagine that you are a parent, and your child is going to college in 4 years. Tuition fees amount to $16,000 a year for each of
LiRa [457]

Answer:

lump sum money= $52653

Explanation:

Giving the following information:

Your child is going to college in 4 years.

Tuition fees amount to $16,000 a year for each of the 4 years.

You plan on depositing a lump sum of money today in a bank account paying 5% interest a year.

The first tuition fee payment you make will be 4 years from now.

FV= 16000*4= $64000

n= 4 years

i= 0.05

We need to find the annual payments:

PV= FV/(1+i)^n

PV= 64000/1.05^4= $52653

7 0
3 years ago
Harold asks his prospects several questions to understand the reasons for their hesitation in buying his product. He tries to id
Fofino [41]

Answer:

fhuafuhfuhsuihfuishfdvbcgufjvhfigirhhjfhhhfhh

Explanation:

5 0
3 years ago
A manufacturing company producing medical devices reported $59 million in sales over the last year. At the end of the same year,
kaheart [24]

Answer:

The inventory TO is 3.6875

Explanation:

\frac{Sales}{Average Inventory} = $Inventory Turnover

​where:

$$Average Inventory=(Beginning Inventory + Ending Inventory)/2

Considering there is not sufficient information to calculate the begining inventory <u>we are going to work only with the ending inventory </u>so:

\frac{59,000,000}{16,000,000} = 3.6875

The inventory TO is 3.6875 This means the company sales their inventory almost 4 times per year.

4 0
3 years ago
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