Question 37 (0.5 points)

I am buying a put option today for a 3 month term. The exercise price is $ 50 per share. Three months later, if the stock market price is $ 65, then:

Options for question 37:

I had better exercise my Put

I have no interest in exercising my Put.

Question 38 (0.75 points)

A company has $ 800,000 in perpetual bonds outstanding. Its tax rate is 35%. Calculate the debt-related tax benefit according to Miller (1977), if investors are taxed at 15% on income from shares and are not taxed on income from bonds.

Options for question 38:

$ 363,000,000

440,500,000 $

$ 370,000,000

$ 368,000,000

$ 358,000,000