An oil company has zero coupon notes outstanding that mature one year from now. that is, each note promises to make a single payment of $1000 one year from now with no coupon payments between now and then. unlike ordinary zeros, the note also promises investors a bonus payment equal to 15 times the amount by which the prevailing oil price on the maturity date exceeds $60 per barrel (for example, if the oil price is $62 at maturity, the holder receives $1000 plus 15 x $2 or $1030 in all; if the price of oil is below $60, the holder receives only $1000). the oil company’s investment bankers estimate that the oil company could instead have issued a conventional one‐ year zero at a yield of about 8%. suppose also that investors are convinced that the price of oil one year from now will be either $50 or $70 per barrel. annual risk free rate is 3% and the current oil price per barrel is $60.

suppose that investors do not have good idea about what oil price will be in the next year. but, they believe that the annual standard deviation of oil prices is 20%. how much do you think the notes are worth?

technology is the application of knowledge and tools to solve problems and perform tasks more efficiently. t/f

In return for their with optimizing his painting project, the castle servant informed poly and digit that he saw someone dressed as the king leaving behind a trail of crumbs as he walked into the jester's room late last night. poly and digit have finally found the crisp-collecting culprit — it turns out the jester's shoe size and hair color match the clues that were found! in gratitude, poly and digit agree to the servant with his current task of replacing all of the tables and chairs in the castle. his goal is to determine which furniture company should produce the new furniture. he receives information from a company that customizes elegant furniture, and he wants to analyze the company's production process in order to calculate some problems about cost and availability. read the following scenario, and assist poly and digit as they the servant with his calculations. the fit for a king furniture company requires 2020 hours of labor to produce a standard table, and a chair requires 1212 hours of labor. the labor available is 565565 hours per week. the company can produce at most 3535 chairs per week.

Capital financial corporation will lend 90 percent against account balances that have averaged 30 days or less; 80 percent for account balances between 31 and 40 days; and 70 percent for account balances between 41 and 45 days. customers that take over 45 days to pay their bills are not considered acceptable accounts for a loan. the current prime rate is 16.50 percent, and capital charges 3.50 percent over prime to charming as its annual loan rate. a. determine the maximum loan for which charming paper company could qualify.