ABC Co. believes that XYZ Corporation’s stock price is going to decline from its current level of ₱82.50 sometime during the next 5 months. For ₱510.25, ABC Co. could buy a 5 month put option for the right to sell 100 shares at a price of ₱83 per share. If ABC Co. bought a 100 share contract for ₱510.25 and XYZ Corporation’s stock price actually dropped to ₱63, what would be the net profit (after transactions costs but before taxes) of ABC Co.? a. ₱1,439.75 b. ₱1,489.75 c. ₱1,950.00 d. ₱2,000.00 e. ₱2,435.00
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ABC Co. believes that XYZ Corporation’s stock price is going to decline from its current level of ₱82.50 sometime during the next 5 months. For ₱510.25, ABC Co. could buy a 5 month put option for the right to sell 100 shares at a price of ₱83 per share. If ABC Co. bought a 100 share contract for ₱510.25 and XYZ Corporation’s stock price actually dropped to ₱63, what would be the net profit (after transactions costs but before taxes) of ABC Co.?
a. ₱1,439.75
b. ₱1,489.75
c. ₱1,950.00
d. ₱2,000.00
e. ₱2,435.00
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- The Bulldogs Inc.’s stock price is believe to decline from its current level of P125 anytime during the next 9 months. A 9-month put option for P975 is available to be purchased and it gives the buyer the right to sell 100 shares at a price of P130 per share. What would be the net profit if a 100-share contract is bought for P975 and Bulldogs Inc.’s stock price actually dropped to P90?Mr. Wa Is believes that ABC Co.’s stock price is going to decline from its current level of P82.50 sometime during the next 5 months. For P510.25 he could buy a 5-month put option giving him the right to sell 100 shares at a price of P83 per share. If he bought a 100 share contract for P510.25 and ABC Co.’s stock price actually dropped to P63, what would be his net profit (after transactions costs but before taxes)? A. P1,439.75 B. P1,489.75 C. P1,950.00 D. P2,000.00 E. P2,435.00The Beranek Company, whose stock price is now $20, needs to raise $30 million in common stock. Underwriters have informed the firm's management that they must price the new issue to the public at $16 per share because of signaling effects. The underwriters' compensation will be 4% of the issue price, so Beranek will net $15.36 per share. The firm will also incur expenses in the amount of $190,000. How many shares must the firm sell to net $30 million after underwriting and flotation expenses? Do not round intermediate calculations. Write out your answer completely. For example, 5 million should be entered as 5,000,000. Round your answer to the nearest whole number.
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