Specialization increases the productivity of a nation's resources and allows for larger total output.
Answer: Liquidation value
Explanation:
The liquidation value is one of the type of physical assets of an organization and the business value, real estate firms, directories and the equipment are refers as the liquidation value that helps in evaluating the overall worth of the firm.
This organizational value is lower as compared to the market value and it has less time for selling the products in the open market.
According to the given question, the liquidation value is refers as the actual amount of the stockholder expected value value in the market. Therefore, Liquidation value is the correct answer.
Answer:
a) What is the expected transaction price with variable consideration estimated as the expected value?
- original cost $5,800 if job is finished in one month (15% probability)
- bonus price for finishing 2 weeks earlier $5,800 x 1.25 = $7,250 (25% probability)
- bonus price for finishing 1 week earlier $5,800 x 1.15 = $6,670 (60% probability)
expected transaction price = ($5,800 x 15%) + ($7,250 x 25%) + ($6,670 x 60%) = $6,684.50
b) What is the expected transaction price with variable consideration as the most likely amount?
$6,670, since it has a 60% probability
Answer:
A) according to put call parity:
price of put option = call option - stock price + [future value / (1 + risk free rate)ⁿ]
put = $8.89 - $120 + [$120 / (1 + 8%)¹/⁴] = $8.89 - $120 +$117.71 = $6.60
B) you have to purchase both a put and call option ⇒ straddle
the total cost of the investment = $8.89 + $6.60 = $15.496, this way you can make a profit if the stock price increases higher than $120 + $6.60 = $126.60 or decreases below than $120 - $6.60 = $113.40
