Answered

Join the growing community of curious minds on IDNLearn.com. Join our knowledgeable community and access a wealth of reliable answers to your most pressing questions.

Delta Importers has a pure discount loan with a face value of $180,000 due in one year. The assets of the firm are currently worth $265,000. The shareholders in this firm basically own a _____ option on the assets of the firm with a strike price of _____. Group of answer choices Put; $180,000 Put; $265,000 Warrant; $265,000 Call; $180,000 Call; $265,000

Sagot :

Parrainidn

Answer: Call; $180,000

Explanation:

A Call option gives the holder the right to buy an asset if they want to at a certain set price.

In this scenario the shareholders of this firm can buy the assets of this company in order to pay off the debt of $180,000 which in essence makes $180,000 the strike price thereby making this a call option.

We appreciate your participation in this forum. Keep exploring, asking questions, and sharing your insights with the community. Together, we can find the best solutions. Your questions deserve precise answers. Thank you for visiting IDNLearn.com, and see you again soon for more helpful information.