The information content of a regular dividend increase generally signals that:Multiple Choicefuture dividends will be lower.the
1 answer:
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Answer:
(a) $34.4
(b) $38.70(Approx).
(c) $61.9524
Explanation:
(a) Current price:
= $34.4
We use the formula:
where,
A = future value
P = present value
r = rate of interest
n = time period
(b)
= 34.4 × 1.124864
= $38.6953
= $38.70(Approx).
(c)
= 34.4 × 1.80094351
= $38.6953
= $61.9524
Answer:
The answer is "$400"
Explanation:
The price value of the exercise:
= $127
The expiration date price value is:
= $135
Calculating the profit for Calls buyer:
= $135-$127
= $8
The value of 1 call = 100 shares
calculating the total profit :
=$ 8 × 100
= $ 800
One alternative purchase price:
= $12
Call option Total purchase price:
= $12 × 100
= $1200
The buyer's total loss:
= $1200 - $800
= $400
The Loss for the buyer:
Hence profit for the writer = $400