What is a description of the trading strategy where an investor sells a 3-month call option and buys a one-year call option, where both options have a strike price of $100 and the underlying stock price is $75?
A. Neutral Calendar Spread
B. Bullish Calendar Spread
C. Bearish Calendar Spread
D. None of the above
B
This is a bullish calendar spread because a big increase in the stock price between three months and one year is necessary for the trading strategy to be profitable.
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Pocket Corporation acquired 100 percent of the voting shares of Sleeve Inc. by issuing 10,000 new shares of $5 par value common stock with a $30 market value.Required:1. Which company is the parent and which is the subsidiary?2. Define a subsidiary corporation.3. Define a parent corporation.4. Which entity prepares the consolidated worksheet?5. Why are consolidation entries used?
What will be an ideal response?
Answer the following statements true (T) or false (F)
1. A company produces 100 microwave ovens per month, each of which includes one electrical circuit. The company currently manufactures the circuit in-house but is considering outsourcing the circuits at a contract cost of $28 each. Currently, the cost of producing circuits in-house includes variable costs of $26 per circuit and fixed costs of $5,000 per month. The controller says that they should outsource production of the circuit, if it reduces fixed cost more than $200 per month. Is this statement true or false? 2. Deeper Clean Company makes bulk quantities of cleaning fluids. They currently sell 1,300 containers a month at a sales price of $24 per unit. If they add a new scent, they could charge $28 per unit for the improved product. It would cost them a total of $900 per month to make that alteration. If they decide to process further, it will improve their operating income. 3. Blue Streak Company makes a special kind of racing tire. Variable costs are $340, and fixed costs are $35,500 per month. Blue Streak sells 610 units per month at a sales price of $410. If Blue Streak upgrades the quality of the tire, management believes that the sales price can be increased to $450. If so, the variable cost will increase to $350, and the fixed costs will rise by 30%. The CEO wishes to increase his operating income by at least 20%. If the company decides to upgrade the product, the CEO will reach his goal.
In the private sector, the use of third party dispute resolution is voluntary - both labor and management must agree to use it.
Answer the following statement true (T) or false (F)
________ are the most common types of new services.
A. Style changes B. Major innovations C. Start-up businesses D. Service line extensions E. Service improvements