When dividends increase with all else remaining the same, which of the following is true?

A. Both calls and puts increase in value
B. Both calls and puts decrease in value
C. Calls increase in value while puts decrease in value
D. Puts increase in value while calls decrease in value


D

Dividends during the life of an option reduce the final stock price. As a result dividend increases cause puts to increase in value and calls to decrease in value.

Business

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In evaluating proposed or existing strategies managers should

A. align existing strategies with new strategies to emphasize incremental gains. B. initiate new initiatives even though they don't seem to match the company's internal and external situation. C. ensure core capabilities are incorporated for establishing a competitive advantage. D. evaluate the firm's business model at least every three years. E. scrutinize the company's existing strategies on a regular basis to ensure they offer a good strategic fit, create a competitive advantage, and result in above-average performance.

Business

Jackson Corp. common stock paid $2.50 in dividends last year (D0). Dividends are expected to

grow at a 12-percent annual rate forever. If Jackson's current market price is $40.00, what is the stock's expected rate of return (nearest .01 percent)? A) 5.50% B) 19.00% C) 11.00% D) 18.25%

Business

An organization that does well in creating, acquiring, and transferring knowledge and in modifying behavior to reflect new knowledge is referred to as a ________ organization.

A. learning B. virtual C. centralized D. network

Business

An option contract gives one of the parties an absolute right to enter into a second contract at a later date

Indicate whether the statement is true or false

Business