GSU‚ Department of Finance‚ AFM Spring 2014 - Chapters 10-11 / page 1 - Introduction to Derivative Markets FI 4200/AFM Characteristics of Options r Definitions and Positions: - A Call Option gives its owner for a specified time the right to purchase an underlying good at a specified price (= exercise price or strike price) - A Put Option gives its owner for a specified time the right to sell an underlying good at a specified price (= exercise/strike price) - An American Option
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Microeconomics Introduction : What microeconomics is all about ? Macroeconomics focus on the economy as a whole. In macro‚ you outline relationships between variables ( growth‚ employment rate‚ investment…). Micro : focus on economic agents‚ players‚ and companies. Focus on how consumers and companies are behaving. In micro you look at the economy as being structured‚ divided in several individual markets. It is an important difference in focus : from the overall standpoint to the
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Workbook for Game Theory and Political Economy1 Martin Gregor IES‚ Charles University in Prague January 23‚ 2012 set of sample exercises has been created for the undergraduate course JEB064 Game Theory and Political Economy given by Martin Gregor at IES‚ Charles University‚ Prague. Each exercise includes a full solution. The workbook is a work in permanent construction. Any comment is more than welcome. 1 This 2 Contents 1 Essentials in game theory 1.1 Centipede game (Rasmusen 2007)
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EXC3613 Risk Management with derivatives Geir Høidal Bjønnes geir.bjonnes@bi.no 1 Introduction • Learning objectives: 1. 2. 3. 4. What is a derivative? What is the role of Derivatives and Derivatives Markets Firms’ risk exposures Hedging price risk with derivatives • McDonald: Chapter 1 2 Example • Consider a farmer that grows wheat and is expecting to yield 10‚000 bushels of crop in 3 months. He is afraid that the price of wheat might drop at the period
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ABN AMRO reserve exchangeable securities ABN AMRO bank is issuing Reverse Exchangeable Securities (RES) that are valued based on dell shares and mature in 1.5 years with a principal payoff that does not exceed the initial principal amount. Given in the case is that the current price of a Dell share is $25.72. If an investor would like to invest $1000‚ the investor would be able to own 38.88 ($1000/$25.72) shares of Dell. The coupon rate is semi annually paid at 12%. The investors payment structure
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Oligopoly From Wikipedia‚ the free encyclopedia An oligopoly is a market form in which a market or industry is dominated by a small number of sellers (oligopolists). Oligopolies can result from various forms of collusion which reduce competition and lead to higher costs for consumers. [1] With few sellers‚ each oligopolist is likely to be aware of the actions of the others. The decisions of one firm therefore influence and are influenced by the decisions of other firms. Strategic planning by oligopolists
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because workers act as if the minimum wage is effectively the zero wage (zero gift) reference point‚ while workers in the labor market with no minimum wage treat the zero wage as the zero gift reference point. The second experimental result‚ using payoff functions that make gift exchange more costly to both employers and employees‚ confirms that the effects of a minimum wage on effort within an ongoing labor market are unlikely to have a major adverse effect on employee
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Marketing Management Case: Boeing Student: Professor: Content: 1. Introduction……………………………………………………….…3 2. The case and the problem……………………………………………3 3. Goals and hypotheses………………………………………………..3 4. Boeing………….………………………………………………….…4 4.1. Synopsis…………………………………………………….…..4 4.2. Analysis……………………………………………………........4 4.3. Strengths & Weaknesses………………………………………
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Expected Monetary Value In a business environment‚ we frequently use probabilities to assess alternative financial decisions Example 1: A coin is tossed ten times. When a head is obtained‚ €4 is won. When a tail is obtained‚ €2 is lost Calculate the expected winnings. Outcome HEAD TAIL Winnings €4 -€2 Probability 0.5 0.5 Expected winnings in one toss: Expected Monetary Value (or just Expected Value (EV) = €1 Note: You never actually receive
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Strategic Management Airbus Analysis Executive Summary The goal of the following report is to provide a detailed analysis of Airbus using the following analytical tools: PESTEL‚ Stakeholder‚ SWOT‚ Porters Five Forces‚ VRINE‚ and Porters model of competitive advantage. In this report I will describe how each analysis supports the decisions of Airbus and helps identify any problems or issues facing Airbus based on the outcome of each analysis. This report
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