What is your net gain or loss on this investment

Assignment Help Financial Management
Reference no: EM13945386

You wrote ten call option contracts on JIG stock with a strike price of $41 and an option price of $.60. What is your net gain or loss on this investment if the price of JIG is $46.05 on the option expiration date?

Reference no: EM13945386

Questions Cloud

Homewood suites operates a regional hotel chain : Homewood Suites operates a regional hotel chain. Each hotel is operated by a manager and an assistant manager/controller. Many of the staff who run the front desk, clean the rooms, and prepare the breakfast buffet work part-time or have a second job,..
What looping structure is being used : What variables are used this module? What are their data types?
Our foreign currency exposures were principally euros : At December 31, 2007, our foreign currency exposures were principally Euros, British pound sterling, Danish krone and Japanese yen.
How would you use these cash flows in valuation : Explain how derivative securities are used to find certainty equivalent cash flows. How would you use these cash flows in valuation?
What is your net gain or loss on this investment : You wrote ten call option contracts on JIG stock with a strike price of $41 and an option price of $.60. What is your net gain or loss on this investment if the price of JIG is $46.05 on the option expiration date?
Integer linear programming model to assist park management : Formulate and solve an integer linear programming model to assist the park’s management to plan and schedule the number of new employees it hires each week in order to minimize the total number of new employees it must hire during the summer. It may ..
Pharmacotherapy for endocrine and musculoskeletal disorders : Patients with endocrine and musculoskeletal disorders often require long-term treatment and care resulting in the need for extensive patient education. By appropriately educating patients, advanced practice nurses can assist patients with the mana..
What is the company unlevered cost of equity capital : Skillet Industries has a debt–equity ratio of 1.3. Its WACC is 7.1 percent, and its cost of debt is 6.6 percent. The corporate tax rate is 35 percent. What is the company’s unlevered cost of equity capital? What would the cost of equity be if the deb..
You work for a company that manufactures high tech : You work for a company that manufactures high tech electronic equipment. You are the project manager responsible for the development of a new type of Handset for 3G applications. The project life cycle is made up of the phases in the WBS below. Each ..

Reviews

Write a Review

Financial Management Questions & Answers

  Preferred stock rate of return

What is the required rate of return on a preferred stock with a $50 par value, a stated dividend of 9% of par, and a current market price of (a) $66, (b) $86, (c) $115, and (d) $137 (assume the market is in equilibrium with the required return equal ..

  What is the value of american call

Suppose that the exchange rate is 1 dollar for 120 Yen. The dollar interest rate is 5%(continuously compounded) and the yen rate is 1%(continuously compounded). Consider an at the money American dollar call that is yen-denominated. The option has 1 y..

  Highest earning per share of ordinary share capital

Business is going well for David Johns Inc., the company that operates remote parking lots near major airports. The board of directors of this family-owned company believes that David Johns Inc. could earn an additional $1.5 million income before int..

  What would be the new cost of equity after recapitalization

LVMH currently has a debt-to-capital ratio of 10% and an average tax rate of 34%. LVMH's bonds have a 4% yield to maturity. Using the CAPM, the firm estimates that its cost of equity is 12%. What would be the new beta if the company goes ahead with t..

  Expected return on the asset-market risk premium

Consider an asset that has a beta of 1.20. If the risk-free rate is 2.0% and the market risk premium is 3%, expected return on the asset is: Assume that you are a U.S. investor who is considering investments in the German (Stocks A) and British (Stoc..

  What is macrs

1. What's MACRS? What's the difference between the MACRS approach and the straight-line approach?

  What is the amount of the projected cash disbursements

Nadine's Boutique has a 30 day accounts payable period. The firm has expected quarterly sales of $1,100, $1,400, $1,600, and $2,100, respectively, for next year. The quarterly cost of goods sold is equal to 68 percent of the next quarter's sales. The..

  Supports depreciating long-term assets

What is the underlying principle that supports depreciating long-term assets over their useful lives instead of just expensing them when purchased? We want full disclosure of large cash expenditures.

  What does the beta of the new security have to be

You currently own a portfolio valued at $16,000 that has a beta of 1.2. You have another $8,000 to invest and would like to invest it in a manner such that the risk of your portfolio matches that of the overall market. What does the beta of the new s..

  What is the yield to call for these bonds

Alex plans to purchase a callable bond of Horizon Inc. The bond is 20-year to maturity, carry 10.5% annual coupon, paid semi-annually, and have a$1,000 par value. The bond is selling now for $1,187.40 each. The bond can be called back in 5 years at a..

  A credit default swap is essentially

A credit default swap is essentially a

  Supply and demand analysis and marginal analysis

Discuss why both supply and demand analysis and marginal analysis must be used in making rational business decisions. Please include specific examples in your discussion posts. Also include the difference between substitutes and complements and the d..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd