Suppose you buy 18 contracts of the August 37 put option. c-1. What is your maximum gain? c-2. On the expiration date, Macrosoft is selling for $31 per share. How much is your options investment worth? c-3. On the expiration date, Macrosoft is selling for $31 per share. What is your net gain? Suppose you sell 18 of the August 37 put contracts. d-1. What is your net gain or loss if Macrosoft is selling for $33 at expiration? (Enter your answer as a positive value.) d-2. What is your net gain or loss if Macrosoft is selling For $39 at expiration? (Enter your answer as a positive value.) d-3. What is the break-even stock price? (Round your answer to 2 decimal places, e.g., 32.16.) Buckeye Industries has a bond issue with a face value of $1,000 that is coming due in one year. The value of the company's assets is currently $1,270. The CEO believes that the assets in the company will be worth either $880 or $1,400 in a year. The going rate on one-year T-bills is 6 percent. a-1. What is the value of the company's equity? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) a-2. What is the value of the debt? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Suppose the company can reconfigure its existing assets in such a way that the value in a year will be $960 or $1,820. b. If the current value of the assets is unchanged, what is the new value of the company's equity? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Use the option quote information shown here to answer the questions that follow. The stock is currently selling for $35. a. Suppose you buy 18 contracts of the February 37 call option. How much will you pay, ignoring commissions? Suppose you buy 18 contracts of the February 37 call option. Macrosoft stock is selling for $38 per share on the expiration date. b-1. How much is your options investment worth? b-2. What if the terminal stock price is $37 ? Suppose you buy 18 contracts of the August 37 put option. c-1. What is your maximum gain? c-2. On the expiration date, Macrosoft is selling for $31 per share. How much is your options investment worth? c-3. On the expiration date, Macrosoft is selling for $31 per share. What is your net gain? Suppose you sell 18 of the August 37 put contracts. d-1. What is your net gain or loss if Macrosoft is selling for $33 at expiration? (Enter your answer as a positive value.) d-2. What is your net gain or loss if Macrosoft is selling For $39 at expiration? (Enter your answer as a positive value.) d-3. What is the break-even stock price? (Round your answer to 2 decimal places, e.g., 32.16.) Buckeye Industries has a bond issue with a face value of $1,000 that is coming due in one year. The value of the company's assets is currently $1,270. The CEO believes that the assets in the company will be worth either $880 or $1,400 in a year. The going rate on one-year T-bills is 6 percent. a-1. What is the value of the company's equity? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) a-2. What is the value of the debt? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Suppose the company can reconfigure its existing assets in such a way that the value in a year will be $960 or $1,820. b. If the current value of the assets is unchanged, what is the new value of the company's equity? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Use the option quote information shown here to answer the questions that follow. The stock is currently selling for $35. a. Suppose you buy 18 contracts of the February 37 call option. How much will you pay, ignoring commissions? Suppose you buy 18 contracts of the February 37 call option. Macrosoft stock is selling for $38 per share on the expiration date. b-1. How much is your options investment worth? b-2. What if the terminal stock price is $37
