Strategy to buy future contracts-options both call and put

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1- Describe the best strategy to buy future contracts and options both call and put ?

2- how people make/ lose money in future and options contracts? give exsample.

3. Project L costs $48,877.05, its expected cash inflows are $10,000 per year for 10 years, and its WACC is 10%. What is the project's IRR? Round your answer to two decimal places.

4. The Killington Corporation has planned capital expenditures of $40 million for the upcoming fiscal year. Killington's stock is currently selling at $25 per share. Flotation costs are 10%. The earnings growth rate has been steady and is expected to continue. The last dividend paid was $1.20 per share and is expected to grow at a rate of 5%. The company tax rate is 40%. The Mortgage bonds are currently selling for $1,073.61. The bonds are 7%, $1,000 par and pay interest annually. They will mature in 10 years.

Compute the after-tax cost of each component of capital.

a) Bonds

b) Retained Earnings

c) New Common Stock

Reference no: EM131912424

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