1. A company with a Tax Rate (T) of 30% books an expense of $3.6 million dollars to record Depreciation Expense for a piece of Equipment. What is the net effect of this expense on the company’s consolidated cash flow?
a. $3,600,000
b. $1,080,000
c. $2,520,000
d. $1,860,000
e. None of the above
2. Suppose trader Jean is neutral on the market, which trading strategy (or strategies), will you recommend to him? (Choose one and the best answer)
Long a butterfly
Long a put
Long a call
Long a bear spread
Short a butterfly