Assume you pay a premium of $0.50/bu for a put option with a strike price of $4.00/bu and that the current futures price is $4.25/bu. Then, the option is:
A. In-the-money
B. At-the-money
C. Out-of-the-money
D. None of the above
Ans: C. Out-of-the-money
Economics
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Fast Copy is a perfectly competitive firm. The figure above shows Fast Copy's cost curves. If the market price is 2 cents per page, what is Fast Copy's economic profit?
A) zero B) between 0 and $0.50 per hour C) between $0.51 and $1.00 per hour D) more than $1.00 per hour
Economics
Refer to Figure 2-13. Which country has a comparative advantage in the production of coconuts?
A) Guatemala B) Costa Rica C) They have equal productive abilities. D) neither country
Economics