a) Suppose the spot exchange rate is $1.22 per British pound and the strike on a dollar denominated pound put is $1.20. Assume r = 0.04, rf = 0.05, σ = 0.20 and the option expires in 270 days. What is the put option price?
[5 Marks]
b) Suppose the 180-day futures price on crude oil is $110.00 per barrel and the volatility is 20.0%. Assume interest rates are 3.5%. What is the price of a $120 strike call futures option that expires in 180 days? [5 Marks]
Answers
The right to sell the underlying asset at the agreed-upon price (Strike Price) will be granted to the Put option holder. He must pay the writer of the Put option premium because he is receiving a right.
When the expected future spot price reaches the Strike Price, the put option holder will exercise the right. The option's author is then obligated to purchase at the strike price.
If Holder is bearish, he will choose the put option.
Stock Price or Spot Price $ 1.22 Strike Price or Exercise Price $ 1.20 SD 0.2 variance (SD2) 0.04 Risk free Rate 4.00% Time period in Years 0.7500 Step1: If the Future Spot Price is less than the Strike Price, it is in the money. If the Future Spot Price is greater than the Strike Price, it is out of the money. Assuming 360 days per year, the following particulars are true:
S - Stock Price X - Exercise Price = Ln (1.0167) = 0.0165 Step 2:
Step 3:
d2 is equal to d1 minus [SD * SQRT (T)] = 0.3551 minus [0.2 * SQRT (0.75)] = 0.3551 minus [0.2 * 0.866] = 0.3551 minus 0.1732 = 0.1819 Step 4:
NT( d1) = 0.1405
0.1405
Stage 5:
Step 6: NT (d2) = 0.0714 0.0714
Step 7: N(d1) = 0.5, NT(d1) = 0.5, and 0.1405 = 0.6405
Step 8: N(d2) = 0.5, NT(d2) = 0.5, and 0.0714 = 0.5714
e^-rt :
= e-0.04*0.75 = e-0.03, which equals 0.9704 Step 9:
The value of the call is as follows: [S*N(d1)] - [X*e-rt*N(d2)] = [$ 1.22 * 0.6405] - [$ 1.2 * 0.9704 * 0.5714] = [$ 0.7814] - [$ 0.6654] = [$ 0.12] Step 10:
Step 11: N(-d1) = 1 - N(d1) = 1 - 0.6405 = 0.3595
Step 12: N(-d2) = 1, N(d2) = 1, and 0.5714 = 0.4286
The Put's value is as follows: [X * e-rt * N(-d2)] - [S * N(-d1)] = [$1.2 * e-0.04 * 0.75 * 0.4286] - [$1.22 * 0.3595] = [$1.2 * 0.9704 * 0.4286] - [$1.22 * 0.3595] = [$0.5] - [$0.44] = $0.6
Vc + PV of Strike Price = $ 0.12 + $ 1.1645 = $ 1.28 Stock Price + Vp = $ 1.22 + $ 0.06 = $ 1.28 The Put Option's Value is therefore $ 0.06
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Related Questions
Vera has a June credit card balance of $476.09. Her payment due date is June 27th, with a grace period of 5 days. If her payment is late, the credit card company charges a $30 late fee. Vera wants to pay the full amount to have a zero balance. How much should she pay if her online payment is processed on July 6th? $
Answers
Answer:
$506.09
Explanation:
Calculation for the amount she should pay if her online payment is processed on July 6th
Since we were told that Vera payment due date is June 27th in which she has a June credit card balance of the amount of $476.09 and a grace period of 5 days was given to her in a situation where Vera payment is late with a charges of the amount of $30 as late fee, this means that the if her online payment is been processed on July 6th and she want to pay the amount amount in full in order for her to have a zero balance she will have to pay the amount of $506.09 calculated as:
Amount to be paid=Credit card balance+Late fee charges
Amount to be paid= $476.09+$30
Amount to be paid=$506.09
Therefore the amount Vera should pay will be $506.09
Answer:
$506.09
Explanation:
Education has no effect on income potential.
True
False
Answers
i mean i want to be a bball player and me learning about geometry has nothing to do with that
Write the quadratic equation in standard form that corresponds to the graph shown below.
Answers
The quadratic equation of the graph in standard form is y = x² + 2x - 8
What is a quadratic equation in standard form?A quadratic equation in standard form is given by y = ax² + bx + c
Given the graph below, to write the quadratic equation for the graph in s tandard form, we notice that the graph has two x - intercepts at
(-4, 0) and(2, 0)The x - intercepts are the roots of the quadratic equation.
So, we have that
x = -4 andx = 2So,
x + 4 = 0 andx - 2 = 0So, the factors of the quadratic equation are
x + 4 andx - 2So, multiplying the factors, we have that the equation is
y = (x + 4)(x - 2)
= x² - 2x + 4x + 4 × (-2)
= x² - 2x + 4x - 8
= x² + 2x - 8
So, the quadratic equation is y = x² + 2x - 8
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a data analyst receives an email from the vice president of marketing. the vice president is upset because the report they want from the analyst is late. select the best course of action.
a. the analyst should apologize for a deley and inform the vice president that marketing managers caused tthe deley
b. the analyst should call the vice president and ask them how important it realy is to their marketing efforts
c. the analyst should respond saying they understand the vice president concerns provide a status update, and let the vice president know when to expect the complated report d. the analyst should send the report immediately even if it's not completely finished this will make the vice president happy
Answers
As the vice president is upset because the report they want from the analyst is late, the best course of action will be c. the analyst should respond saying they understand the vice president concerns provide a status update, and let the vice president know when to expect the completed report
The data analyst should understand the concerns of the Vice President, and apologize for the delay of the report. He should actively work on it and you can tell the vice president the expect date it to be completed.
In the meantime, The data analyst should provide the vice president with a status update to ensure that you remain informed of its progress. He should also thank him for his patience. hence, option c is the correct option in the above based scenario.
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LEHET ........ is the degree of responsiveness of demand to changes in the price of the commodity in question (e. own price), prices of related goods (cross price) and the income of consumers.
Answers
Answer:
handsome
Explanation:
beautifuljvc htibccy yfxhnnoln bddgjnnjkk vftnnbhhc basic
What is the minimum requirement to enroll in an open college?
A. 17 on the ACT
B. 1000 on the SAT
C. There is no requirement.
D. 2.0 GPA
Answer is C.
Answers
Answer:
c. there is no requirement
A Machine makes 5 buttons at a time each doll shirt gets 5 buttons how many doll shirts can be finished with 5 buttons
Answers
Answer:
1
Explanation:
If each doll shirt gets 5 buttons then only one can be finished with 5 buttons.
On average, a person with a bachelor's degree earns
than a person
with an associate degree and
than a person with a high school
diploma
O A. more; more
O B. less; more
O c. less; less
O D. more; less
SUBMIT
Answers
Answer:
B
Explanation:
the knowledge.. between a Bachelor degree and an associate degree. is leser
What is a tax free savings account that can only be used for educational expenses
Answers
A tax-free savings account that can only be used for educational expenses is called a 529 plan, which is specifically designed for education purposes and includes education expenses such as tuition, fees for books, etc.
What is the significance of the savings account?Savings accounts keep track of personal expenses such as a person's bank balance, which can be withdrawn when needed; savings accounts earn interest as a result, the money grows over time and helps the person get a loan with a certain amount, etc.
Hence, tax-free savings account that can only be used for educational expenses is called a 529 plan, which is specifically designed for education purposes and includes education expenses such as tuition, fees for books, etc.
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What term refers to the power of the government to tax and spend to achieve
economic goals?
A. Fiscal policy
B. Discretionary spending
C. Monetary policy
D. Economic efficiency.
Answers
Which of the following actions is a good example
of protecting sensitive information? Check all of
the boxes that apply.
using a paper shredder to discard documents
that contain personal medical information
keeping patient files in a secure electronic file
system with limited access
maintaining a confidential patient consultation
area in a doctor's office
discussing private matters with patients in the
waiting room
Answers
Answer:
A,B,C
Explanation:
Answer:
“Using a paper shredder to discard documents that contain personal medical information”, “Keeping patient files in a secure electronic file system with limited access” and “Maintaining a confidential patient consultation area in a doctor’s office”
Explanation:
How can technology be a barrier to communication?
Answers
Technology can certainly be a barrier to communication in several ways. Firstly, people can rely too much on technology to communicate, which can lead to a lack of personal interaction and human touch.
For example, texting or emailing can be convenient, but they lack the emotional nuances and facial expressions that are essential for effective communication. Therefore, people can misunderstand the message or tone of the message and lead to communication breakdowns.
Secondly, technological devices can malfunction or have connectivity issues, which can delay or disrupt communication. For instance, a poor internet connection or a device that crashes can prevent people from exchanging important information, leading to frustration and even delays in decision-making. Additionally, some people might not have access to technology, which can further create barriers to communication.
Lastly, technology can create language barriers for people who do not speak the same language or have difficulty understanding technical jargon. This can lead to confusion, miscommunication, and even discrimination in some cases.
Overall, while technology has many benefits, it can also be a barrier to communication if used inappropriately or without consideration of its limitations. Therefore, it is important to find a balance between technology and personal interaction, depending on the context and purpose of the communication.
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First Bank loaned $360,000 for 180 days to a company purchasing a rock-crushing machine. The bank sold the 7% simple interest note 120 days later at an 8% discount rate. Find the proceeds. Assume a 360-day year for both notes.
Answers
In 2022, Rogers & co. reported Net Income equal to $1,000. The company reported Depreciation Expense of $200. The company repurchased 10 shares of Treasury Stock for $500 (10 shares for $50 each). The stock had a par value of $5. The company also paid a dividend of $80 ($0.80 x 100 shares). What was the company's Cash from Financing Activities in 2022? (make the number negative if it is a net cash outflow)
Answers
The company's Cash from Financing Activities in 2022 a net cash outflow of $580.
The repurchase of treasury stock is a financing activity, while the net income and depreciation expense are not. The payment of dividends is also a financing activity, as it represents a distribution of profits to the shareholders. First, let's calculate the cash outflow from the repurchase of treasury stock. The company bought 10 shares for $50 each, which amounts to $500. Since this is a cash outflow, we will show it as a negative number.
Next, let's calculate the cash outflow from the payment of dividends. The company paid a dividend of $0.80 per share, and it has 100 shares outstanding. Therefore, the total dividend payment was $80. Again, since this is a cash outflow, we will show it as a negative number.
To calculate the Cash from Financing Activities, we need to add the cash outflows and subtract any cash inflows. In this case, there are no cash inflows, so we only need to add the two cash outflows.
Cash from Financing Activities = - $500 (repurchase of treasury stock) - $80 (payment of dividends) = - $580
Therefore, the company's Cash from Financing Activities in 2022 was a net cash outflow of $580.
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Consider the following information for stocks A, B, and C. The returns on the three stocks are positively correlated, but they are not perfectly correlated. (That is, each of the correlation coefficients is between 0 and 1.)
Stock Expected Return Standard Deviation Beta
A 8.60% 14% 0.8
B 9.95 14 1.1
C 11.75 14 1.5
Fund P has one-third of its funds invested in each of the three stocks. The risk-free rate is 5%, and the market is in equilibrium. (That is, required returns equal expected returns.)
Required:
a. What is the market risk premium?
b. What is the beta of Fund P?
c. What is the required return of Fund P?
d. Would you expect the standard deviation of Fund P to be less than 15%, equal to 15% or greater than 15%? Explain.
Answers
Question attached
Answer and Explanation:
Find attached
2020 quantity
cost
PRICE
2021 quantity
cost
PRICE
Brocoli Cauliflowe Carrots
100
200
50
75
1.5
80
120
1.5
75
2
75
225
3
300
500
50
0.1
500
100
0.2
100
325
475
CPI base year 2020
100
146.154
46%
Inflation rate
Answers
The inflation rate can be calculated using the Consumer Price Index (CPI) formula, which measures the change in the price of goods and services over time. In this case, the base year is 2020, and we want to calculate the inflation rate for 2021.
First, we need to calculate the CPI for 2020 and 2021:
CPI 2020 = (1001.5) + (2002) + (503) = 500
CPI 2021 = (751.5) + (1201.5) + (2253) = 975
Next, we can use the formula to calculate the inflation rate:
Inflation rate = ((CPI 2021 - CPI 2020) / CPI 2020) x 100%
Inflation rate = ((975 - 500) / 500) x 100%
Inflation rate = 95%
Therefore, the inflation rate between 2020 and 2021 is 95%.
What was Indiana's total government expenditures in fiscal year 2018-2019? (1 point)
O $15.9 billion
O $11.9 billion
O$34.89 billion
O $34.11 billion
Answers
Indiana's total government expenditures in the fiscal year 2018-2019 is $34.89 billion. The correct option is C.
Public consumption, public investment, and transfer payments made up of capital transfers and income transfers (pensions, social benefits), collectively referred to as government expenditures, are all included in the definition of goods and services.
Fiscal policy is characterized as the strategy used by the government to carry out various economic policy goals through the use of taxation, public expenditure, and public borrowing.
Thus, the ideal selection is option C.
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Prior to May 1, Fortune Company has never had any treasury stock transactions. A company repurchased 200 shares of its common stock on May 1 for $10,000. On July 1, it reissued 100 of these shares at $52 per share. On August 1, it reissued the remaining treasury shares at $49 per share. What is the balance in the Paid-in Capital, Treasury Stock account on August 2?
Answers
Answer:
$100
Explanation:
The computation of the balance in the paid - in capital for treasury stock account on August 2 is shown below:
On May 1 $0
July 1 : $2/share × 100 shares $200
Less:
Aug 1 : $1 share × 100 shares ($100)
Balance as on August 2 $100
We simply deduct the august 1 amount from the July 1 amount so that the balance as on August 2 for the paid - in the capital for treasury stock could come
2. Who are teachers? Write any two works of teachers.
Answers
Answer:
Teacher are those person who teach us and Help us for a future Work
Their two work are:-
1).They teach us
2):- They teach us moral value and norms
Ethics Student Activity Packet
In this lesson, you will learn to:
- Define what ethics is
- Explore some of the ethical dilemmas our society faces, such as those posed by self-driving cars
- Analyze a number of ethical dilemmas and recommend how the people in these situations should proceed
NOTE: Vocabulary for this unit can be found in the NGPF Personal Finance Dictionary
RESOURCES
Discussion Prompts
Write your responses to the questions. Then, share what you wrote with your classmates or a partner.
QUESTIONS
1. How do you know if a behavior or action is right or wrong?
Answers
A behavior or action is right or wrong due to the fact that it is a specific kind of action, that tends to fits in with some principles or rules, and can also say the behavior is right or wrong due to the fact that it brings about good or negative consequences.
How do we know good and bad behavior?We must first comprehend what we mean when we speak about right and wrong in order to taken in how to acquire moral understanding.
Therefore, one can make use of Conscience-Based Action: Ethical Knowledge. It is seen as a more prevalent viewpoint that exists that is not too dissimilar from that. It is the notion that by paying attention to our conscience, we can determine what is morally right and wrong. What determines whether anything is right or wrong is that still, small voice within of us.
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The purpose of CHIP is to:
A. provide health insurance for people 65 and older.
B. provide income after retirement.
C. provide low-cost insurance coverage to children.
D. make private insurance more affordable.
SUBMIT
Answers
The purpose of CHIP (Children's Health Insurance Program) is to provide low-cost insurance coverage to children, which is option C.
CHIP is a government program in the United States that aims to ensure that eligible children from low-income families have access to essential healthcare services. It was designed to bridge the gap between Medicaid and private insurance, offering affordable health coverage to children who do not qualify for Medicaid but still come from families with limited financial resources. CHIP plays a crucial role in promoting children's well-being by providing them with essential medical care and preventive services.
By offering affordable healthcare coverage to children, CHIP helps reduce barriers to accessing medical services, ensuring that children receive necessary treatments, vaccinations, check-ups, and other healthcare services. This contributes to the overall health and development of children, ultimately leading to healthier communities and a brighter future for the next generation.
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When the economy is doing well, the financial market is also guaranteed to do well.
True
False
Answers
Please give me brainliest!
Rather than determining whether a culture has good or bad ethics, it is best to look for practical solutions to the cultural challenges of doing global business. Which of the following suggestions acknowledge different values and respect the need for moral initiative?
a. Refuse alternatives,
b. Avoid reflex judgments.
c. Don't rationalize shady decisions.
d. Embrace transparency.
Answers
Answer:
Option C
Explanation:
In simple words, Seeking options, rejecting business where it contradicts your core beliefs, and preventing the rationalisation of shady decisions can help you negotiate sometimes vague cross cultural ethics comfortably. It is often prudent to explore alternate routes.
For instance, rather than caving in to federal payments, provide non financial public sector incentives, technological knowledge or extra customer support.
Which one of the following statements is TRUE?
a. An example of an agency cost is when an outside investor is only willing to pay less for stock because she thinks the original owner will consume too many perquisites.
b. The commission required by the Federal Housing Agency for a small business loan is an example of an agency cost.
c. An example of an agency cost is when an attorney hires an expert witness for a trial.
d. An example of an agency cost is when the board of directors pays a dividend to shareholders.
e. An example of an agency cost is the salary of the agent hired to work for the principal.
Answers
Answer: A. An example of an agency cost is when an outside investor is only willing to pay less for stock because she thinks the original owner will consume too many perquisites.
Explanation:
An agency cost typically occurs between between a principal and the agent. This occurs when the agent is given much power and make decisions on behalf of the principal.
An example of an agency cost is when an outside investor is only willing to pay less for stock because she thinks the original owner will consume too many perquisites. The agent typically has more information and there might be different incentives sometimes.
Therefore, the correct option is A.
Harbour Company makes two models of electronic tablets, the Home and the Work. Basic production information follows:
Home Work
Direct materials cost per unit $38 $72
Direct labor cost per unit 23 40
Sales price per unit 359 573
Expected production per month 620 units 490 units
Harbour has monthly overhead of $180,660, which is divided into the following cost pools:
Setup costs $80,840
Quality control 68,620
Maintenance 31,200
Total $180,660
The company has also compiled the following information about the chosen cost drivers:
Home Work Total
Number of setups 41 53 94
Number of inspections 320 410 730
Number of machine hours 1,200 1,400 2,600
Required:
a. Suppose Harbour uses a traditional costing system with machine hours as the cost driver. Determine the amount of overhead assigned to each product line.
b. Calculate the production cost per unit for each of Harbour's products under a traditional costing system.
c. Calculate Harbour's gross margin per unit for each product under the traditional costing system.
Answers
Answer:
Instructions are below.
Explanation:
a)
First, we need to calculate the predetermined overhead rate:
Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
Predetermined manufacturing overhead rate= 180,660/2,600
Predetermined manufacturing overhead rate= $69.49 per machine hour
Now, we can allocate overhead to each product line:
Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base
Home= 69.49*1,200= $83,388
Work= 69.49*1,400= $97,286
b) We need to determine the unitary cost for each product:
Home:
Unitary cost= 38 + 23 + (83,388/620)= $195.50
Work:
Unitary cost= 72 + 40 + (97,286/490)= $310.54
c) Gross margin= selling price - unitary cost
Home:
Gross margin= 359 - 195.5= $163.4
Work:
Gross margin= 573 - 310.54= $262.46
With a savings and investment program designed for retirement, you can _?_. Choose all that apply. (personal finance class)
prepare for those emergency expenditures
primarily help your friends and family in time of need
ensure that you will be better prepared for your retirement years
none of the above
Answers
The savings and investment program that is designed for retirement can be used to:
prepare for those emergency expenditures primarily help your friends and family in time of need.ensure that you will be better prepared for your retirement years.What is an investment?It should be noted that an investment simply means the dedication of asset in order to attain an increase in value for a period of time.
In this case, the investment van be used to prepare for those emergency expenditures, primarily help your friends and family in time of need and ensure that you will be better prepared for your retirement years.
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Josh buys an $8000 10-year bond that has a coupon rate of 4.5 %. If he keeps the bond to maturity, how much interest will he collect?
Answers
Josh will collect $3600 in interest if he keeps the $8000 10-year bond with a 4.5% coupon rate to maturity.
To calculate the interest that Josh will collect from the 10-year bond with an $8000 face value and a coupon rate of 4.5%, we need to consider the annual interest payment and the total number of interest payments over the bond's lifespan.
The annual interest payment can be calculated by multiplying the face value of the bond ($8000) by the coupon rate (4.5%). This gives us an annual interest payment of $360 (8000 * 0.045).
Since the bond has a 10-year maturity, there will be a total of 10 interest payments over its lifespan. Therefore, the total interest Josh will collect can be calculated by multiplying the annual interest payment ($360) by the number of interest payments (10).
Total interest = Annual interest payment * Number of interest payments
Total interest = $360 * 10
Total interest = $3600
Therefore, if Josh keeps the bond to maturity, he will collect a total of $3600 in interest over the 10-year period.
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The study of economics is primarily concerned with:
Answers
______segmentation has long been used by the marketers of products and services
such as automobiles, boats, clothing.cosmetics, financial services, and travel.
a. Behavioral
b. Age
C Gender
d. Income
Answers
Gender segmentation has long been used by the marketers of products and services such as automobiles, boats, clothing.cosmetics, financial services, and travel. The correct option is c.
a. Behavioral Segmentation:
Behavioral segmentation divides customers based on their behavior, usage patterns, and buying habits. It helps marketers understand customers' preferences, loyalty, purchase frequency, and responses to marketing efforts.
This type of segmentation allows marketers to tailor their offerings and marketing messages to specific customer behaviors and needs. For example, in the automobile industry, behavioral segmentation can be used to target customers who frequently upgrade their vehicles or those who prioritize fuel efficiency.
b. Age Segmentation:
Age segmentation categorizes customers into different age groups. This segmentation variable recognizes that different age groups have distinct preferences, lifestyles, and purchasing power.
Marketers use age segmentation to target products and services that align with the needs and desires of specific age demographics. For instance, clothing companies may create separate marketing campaigns to target teenagers, young adults, and middle-aged individuals, each catering to their unique fashion preferences.
c. Gender Segmentation:
Gender segmentation involves dividing customers based on their gender, recognizing that men and women often have different preferences and needs.
Marketers use gender segmentation to create targeted marketing messages and product offerings that appeal specifically to male or female customers. For instance, cosmetic companies may develop separate product lines and marketing strategies for men and women, focusing on their respective beauty needs and preferences.
d. Income Segmentation:
Income segmentation groups customers based on their income levels. It enables marketers to understand the purchasing power and affordability of different customer segments.
By targeting customers based on their income, marketers can tailor their pricing, promotions, and product offerings accordingly. For instance, financial services companies may offer premium banking services to high-income individuals, while providing budget-friendly options for customers with lower incomes. The correct option is c.
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In September of 1998, your father purchased a Michael Jordan basketball card for $0.70. At present, the card is a collector’s item that would fetch $1,900 if sold. If your father were to sell this card now, in September of 2020, what would be the annualized percentage return on his investment?
Answers
Answer:
43.24%
Explanation:
The computation of annualized percentage return on his investment is shown below:-
Future value = Present value × (1 + rate of interest ÷ 100)^time period
$1,900 = $0.70 × (1 + r ÷ 100)^22
(1900 ÷ 0.7)^(1 ÷ 22) = (1 + r ÷ 100)
(1 + r ÷ 100) = 1.4324
r = 1.4324 - 1
= 43.24%
we simply applied the above formula.