8. The delta of a call option on a firm's assets is .624. How much will a project valued at $48,000 increase the value of equity

$29952

Explanation:

From the question, we are informed that the delta of a call option on a firm's assets is 0.624 and that the project is valued at $48,000.

The increase in the value of the equity will be calculated as:

= Value of project investment × Delta of the call option

= $48,000 × 0.624

= $29952

rational decision making is a multi-step process for making choices between alternatives. the process of rational decision making favors logic, objectivity, and analysis over subjectivity and insight. the word “rational” in this context does not mean sane or clear-headed as it does in the colloquial sense.

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