finance

profilellipford

!!Please show work(how did you get the answers), for all questions!!!    Thanks!!!

 

1) Determine the intrinsic values of the following put options when the stock is selling at $63 just prior to the expiration of the options.

a. $55 put price

b. $65 put price

c. $75 put price

 

 

2) Find the real return of the following investments:

STOCK                             NOMINAL RETURN                      INFLATION

A                                                10%                                              3%     
B                                                 15%                                             8% 
C                                                 -5%                                              2%

 

3) The countries of Stabilato and Variato have the following average returns and standards deviations for their stocks, bonds, and short-term government securites. What range of returns shold you expect to earn 95% of the time for each asset class if you invested in Stabilato's securities? From investing in Variato's securities?

 

Stabilato assets                          Average return                           Standard deviation

Stocks                                                8%                                                 3%

Bonds                                                 5%                                                  2%

Short-term government debt               3%                                                 1%

 

 

 

Variato assets                          Average return                           Standard deviation

Stocks                                                15%                                                 13%

Bonds                                                 10%                                                  8%

Short-term government debt               6%                                                   3%

    • 11 years ago
    • 7
    Answer(3)

    Purchase the answer to view it

    blurred-text
    NOT RATED

    Purchase the answer to view it

    blurred-text
    NOT RATED
    • attachment
      stocks_answers.docx

    Purchase the answer to view it

    blurred-text
    NOT RATED
    • attachment
      putprice.doc
    Bids(1)