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| Teaching Since: | Apr 2017 |
| Last Sign in: | 419 Weeks Ago |
| Questions Answered: | 3232 |
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MBA,MCS,M.phil
Devry University
Jan-2008 - Jan-2011
MBA,MCS,M.Phil
Devry University
Feb-2000 - Jan-2004
Regional Manager
Abercrombie & Fitch.
Mar-2005 - Nov-2010
Regional Manager
Abercrombie & Fitch.
Jan-2005 - Jan-2008
A bond issued by Standard Oil worked as follows. The holder received no interest. At thebond's maturity the company promised to pay $1,000 plus an additional amount based onthe price of oil at that time. The additional amount was equal to frhe product of 170 andthe.excess (if any) of the price of a barrel of oil at maturity over $25. The maximumadditional amount paid was $2,550 (which corresponds to a price of $40 per barrel). Showthat the bond is a combination of a regular bond, a long position in call options on oilwith a strike price of $25, and a short position in call options bn oil with a strike priceof $40.
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