[pic] The cost of not taking the cash discount is greater than the cost of the loan (13.680% vs. 10.312%) so the firm should take the cash discount. d. Assume the firm actually takes 80 days to pay its bills and would continued to do so in the future if it did not take the cash discount. Should the company take the cash discount? The firm deciding to pay it off in 80 days and not take the cash discount would stick the firm with the money for
Premium Money Futures contract Interest
| FI475-Project Study | Six Derivatives Mishaps | 2012/5/8 | Sumitomo (future contracts) Background: 1996‚ Sumitomo Corporation was one of the top copper market makers in the world. During the over 10 years under Hamanaka‚ who was a genius charged on allegations that he could manipulate the price of the metal‚ Sumitomo lost at least $1.8 billion as a result of what it said were unauthorized trades‚ which then lost a third of its value on world markets in less than two months. The affair was
Premium Hedge fund Futures contract Risk
regarding commodity market. To achieve the overall objective‚ various sub-objectives have been established. These are: - To study the features of various commodities. - To analyze the market potential of the Commodity market. - To know about the future prospective of the Commodity market. - To know more and more about the commodity market. Commodity Exchange Terminal [pic] Introduction to Commodity Market What is “Commodity”
Premium Commodity market Futures contract
1.) Before we started working on our spreads we had some initial thoughts about which stocks might best fit the different strategies and their purposes. Our bets and assumptions were based on the company’s current situation and some external factors that we thought might influence the stock prices for an up- or down-move. The following are the stocks we used for the different spreads: Starbucks - Bear spread Nike - Bull spread Pfizer - Butterfly‚ Straddle & Strangle For Starbucks
Premium Stock market Economics Derivative
DardenBusinessPublishing:210838 UVA-F-1299 Rev. Feb. 8‚ 2011 This document is authorized for use only by Mattia Tenaglia at Tecnologico de Monterrey. Please do not copy or redistribute. Contact permissions@dardenbusinesspublishing.com for questions or additional permissions. ENRON CORPORATION’S WEATHER DERIVATIVES (A) Everybody talks about the weather‚ but nobody does anything about it.1 In October 2000‚ Mary Watts‚ the chief financial officer of Pacific Northwest Electric (PNW)‚
Premium Weather Risk Climate
Executive summary The Computron‚ Inc. is facing problems regarding pricing the bid for Computron 1000X‚ future functioning of Frankfurt plant‚ impact on production due to current market breakdown. The main concern about Computron is that if the bid of 1000X should not higher than 20% of least bid to get the contract. It is strongly recommended to get the bid for functioning of new plant. Various issues regarding cutting down prices‚ bidding high or low and its pros-cons‚ current market situation
Premium Asset Balance sheet Factory
How do futures exchanges prevent the problem of counterparty risk? 3. What was Laura Cha’s point about jobs in the public versus the private sector? 4. What are two important milestones in the history of pensions‚ i.e. events‚ which made these plans better serve the interest of pensioners? 5. What are the principal agencies of the 2010 European Supervisory Framework‚ created in 2010 in response to the world financial crisis? 6. How does the physical delivery provision in futures markets
Premium Option Futures contract Call option
the firm pays in order to produce chocolate and other merchandise. The 10-K shows that during 2011‚ average cocoa futures contract prices traded in a range between $0.99 and $1.55 per pound‚ based on the Intercontinental Exchange futures contract. During the first half of 2011‚ cocoa futures traded at prices that were near 30-year highs. During the fourth quarter of 2011‚ cocoa futures prices declined significantly due to a very large West African crop flourishing which resulted in a substantial global
Premium Chocolate Futures contract The Hershey Company
volatility implications of the introduction of derivatives on stock market volatility in India using the S&P CNX Nifty Index as a benchmark. To account for non-constant error variance in the return series‚ a GARCH model is fitted by incorporating futures and options dummy variables in the conditional variance equation. We find clustering and persistence of volatility before and after derivatives‚ while listing seems to have no stabilisation or destabilisation effects on market volatility. The postderivatives
Premium Futures contract Derivatives Stock market
www.business.unsw.edu.au Australian School of Business School of Banking & Finance FINS3635 OPTIONS‚ FUTURES AND RISK MANAGEMENT TECHNIQUES Session 2‚ 2013 Assignment Due 9 am on October 23‚ 2013 This is a group assignment to be undertaken by no more than 7 students. Group members can be formed from different tutorial classes. You may use Excel for this assignment. Submission: You must upload your assignment on UNSW Blackboard before 9am on 23/10/2013 and hand in a printed copy in the
Premium Options Option Derivatives