You Own 2,500 Shares of Jordan Co

question 46

Multiple Choice

You own 2,500 shares of Jordan Co.stock which is currently valued at $38 a share.The $40 put has a premium of $2.25 and a put delta of -0.25.What position should you take in $40 put contracts to hedge your stock against a $1 decrease in price?

• A) buy 100 contracts
• B) buy 1,000 contracts
• C) buy 10,000 contracts
• D) write 100 contracts
• E) write 1,000 contracts

Compute accrual-based net income for companies in a consolidated group.

Calculate net income attributable to the noncontrolling interest.

Understand the worksheet process in a father-son-grandson ownership configuration.

Compute consolidated net income in various ownership scenarios.

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Definitions:

Doctrine of Constructive Notice

A principle in law whereby individuals are assumed to be aware of their legal rights and obligations, even if they do not possess actual knowledge of them.

Indoor Management Rule

A party dealing with a corporation may assume that the officers have the valid and express authority to bind the corporation.

Promissory Estoppel

A legal principle that prevents a party from withdrawing a promise made to a second party if the latter has reasonably relied on that promise to their detriment.

Personal Liability

The legal responsibility of an individual to satisfy debts or obligations from their personal assets when they cannot be met through insurance or other protections.