Call option contracts with strike price

Assignment Help Financial Management
Reference no: EM131563055

You purchase 14 call option contracts with a strike price of $80 and a premium of $1.80. Assume the stock price at expiration is $92.00. 1. What is your dollar profit? (Do not round intermediate calculations. Omit the "$" sign in your response.) Dollar profit $ 2. What if the stock price is $77.95? (Negative amount should be indicated by a minus sign. Do not round intermediate calculations. Omit the "$" sign in your response.) If the stock price is $77.95, the call is , so the dollar return is $ .

Reference no: EM131563055

Questions Cloud

What is the effective annual rate on loan : What will your monthly payments be? What is the effective annual rate on this loan?
Conduct research into the question : Conduct research into the question and provide LCC with a letter asserting your opinion based on your research
Describe legal rights and privileges of common stockholders : Briefly describe the legal rights and privileges of common stockholders.
Find the time if the p is given : A testing station found P parts per million (ppm) of sulfur dioxide in the air as a function of the hour h of the day to be p = 0.00174(10 + 24h - h2).
Call option contracts with strike price : You purchase 14 call option contracts with strike price of $80 and a premium of $1.80. Assume stock price at expiration is $92.00. What is your dollar profit?
Calculate payg withholding : Trevor is learning how to calculate PAYG tax withheld amount. Although, he knows MYOB will calculate the figure for him automatically
Explain procedure for the solution of the given equation : Set up the necessary equation where appropriate and solve the given problems. All numbers are accurate to at least two significant digits.
Write a memo to brian explaining your conclusions : What, if any, of his education expenses are deductible and how? Please write a memo to Brian explaining your conclusions
What is the break-even quantity of bagels : You are considering opening a bagel restaurant aimed primarily at the breakfast trade. What is the break-even quantity of bagels?

Reviews

Write a Review

Financial Management Questions & Answers

  Bond valuation-you be willing to pay for bond

Bond valuation-Bond X is noncallable and has 20 years to maturity, How much should you be willing to pay for Bond X today?

  Compute return firm should earn given its level of risk

Compute the return the firm should earn given its level of risk.

  Market portfolio as optimal portfolio of risky securities

Identify whether this statement is considered as Capital Allocation Line, Capital Market Line, Security Market Line or Characteristic Market Line. And why? "The market portfolio as the optimal portfolio of risky securities"

  Current price of stock using the dividend growth model

For Stock x, the cash dividend paid most recently is $5 [D0]. The dividends are expected to grow at a constant rate of 6% per year for ever. The required rate of return on the common stock is 13%. Then Calculate the current price of the stock using t..

  The initial cost of the hotel project for the use of land

Boone Brothers purchased a parcel of land 9 years ago for $363,000. At that time, the firm invested $109,000 modifying the site so that it could be leased to an adjacent car dealer for displaying used car inventory.  What value should be included in ..

  Which mutually exclusive project should be selected

Which mutually exclusive project should be selected, based on a 12% cost of capital and the following: IRR(A)= 15%, IRR(B)= 13%; incremental IRR(B-A)= 18%? Why?

  Using NPV-IRR-MIRR and discounted payback

Using NPV, IRR, MIRR and discounted payback (using 4 years as the bench mark) to determine if the project should be taken. Use the WACC calculated from (1).

  Implied relationship between dividend policy-stock prices

Executive salaries have been shown to be more closely correlated to the size of the firm than to its profitability. If a firm’s board of directors is controlled by management rather than outside directors, this might result in the firm’s retaining mo..

  Properly evaluate projects of unequal lives

Which of the following methods of evaluating investment projects can properly evaluate projects of unequal lives?

  How many times per year does zane turn over its inventory

Zane Corporation has an inventory conversion period of 56 days, an average collection period of 36 days, and a payables deferral period of 31 days. Assume 365 days in year for your calculations. What is the length of the cash conversion cycle? How ma..

  Determine the expected return on the stock

After determining the expected return on its stock, XYZ ventures decides to sell the entire corporation with expected earnings estimated to be $8,000,000. With 200,000 shares outstanding and preferred equity at $4,500,000. Determine the liquidation v..

  What is the current market value of the firm debt

The yield to maturity is 12%, so the bonds now sell below par. What is the current market value of the firm's debt?

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