Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Business Economics Expert

Buy shares or call option

The current price of a stock is $94, and three-month European call options with a strike price of $95 currently sell for $4.70. An investor who feels that the price of the stock will increase is trying to decide between buying 100 shares and buying 2,000 call options (20 contracts). Both strategies involve an investment of $9,400. How high does the stock price have to rise for the option strategy to be more profitable?

 

Business Economics, Economics

  • Category:- Business Economics
  • Reference No.:- M928365

Have any Question? 


Related Questions in Business Economics

Make a list of products and services which are least

Make a list of products and services which are least satisfactory and have shown the least improvement over time. How many of these are produced by government? Do you agree or disagree with this statement by Milton Fried ...

The following is spending information for a given year in a

The following is spending information for a given year in a given country: Businesses spent $2800 on factories and equipment used in production Households spent $1500 on services Households spent $4000 on houses Governme ...

Last year hamdi corp had sales of 500000 operating costs of

Last year Hamdi Corp. had sales of $500,000, operating costs of $450,000, and year-end assets of $420,000. The debt-to-total-assets ratio was 17%, the interest rate on the debt was 7.5%, and the firm's tax rate was 35%. ...

What is the definition of total monetary unit in the

What is the definition of total monetary unit in the context of economics.

What is a financial system and why would a country with a

What is a financial system and why would a country with a well developed and fully functional financial system be better off than a country without it?

Oversize transport inc supplies custom delivery service for

Oversize Transport Inc. supplies custom delivery service for very large construction equipment in the southeast region of United States. The most common lead of the specialty trucker is the Caterpillar model 740 dump tru ...

A describe one marketing failb describe what happened

A. Describe one "marketing fail". B. Describe what happened. (Include an external link to an article describing what happened or an example of the fail.) C. Describe the fallout/negative repercussions. D. Share what (if ...

Assignmentrespond to discussion questions with 150-200

Assignment Respond to Discussion Questions with 150-200 words. In your efforts to provide the answers, I would like to encourage you to also use personal experiences in your responses. Also, cite information from your te ...

Assignment economics issues of the underground economyi

Assignment: Economics Issues of the Underground Economy I have uploaded several articles dealing with the related topics of big city rent control, condo conversion moratoria, and arson fires. They are in a labeled folder ...

The resulting output from the modulation process is known

The resulting output from the modulation process is known as the middle frequency (MF) signal. True or false?

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

A cola-dispensing machine is set to dispense 9 ounces of

A cola-dispensing machine is set to dispense 9 ounces of cola per cup, with a standard deviation of 1.0 ounce. The manuf

What is marketingbullwhat is marketing think back to your

What is Marketing? • "What is marketing"? Think back to your impressions before you started this class versus how you

Question -your client david smith runs a small it

QUESTION - Your client, David Smith runs a small IT consulting business specialising in computer software and techno

Inspection of a random sample of 22 aircraft showed that 15

Inspection of a random sample of 22 aircraft showed that 15 needed repairs to fix a wiring problem that might compromise

Effective hrmquestionhow can an effective hrm system help

Effective HRM Question How can an effective HRM system help facilitate the achievement of an organization's strate