A generator has 100 MWh generation capacity and has the following production cost curve C(q) =...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
A generator has 100 MWh generation capacity and has the following production cost curve C(q) = 200 + 20g +0.1q² It enters the operating day with the following contracts: Seller of a forward contract of 30$/MWh and a quantity of 10 MWh; Seller of a forward contract of 50$/MWh and a quantity of 5 MWh; Buyer of a forward contract of 25$/MWh and a quantity of 5 MWh; • A 5 MWh put option with 285/MWh exercise price, the option fee is $100. . • A 10 MWh call option with 30$/MWh exercise price, the option fee is $50. • A 5 MWh call option with 35$/MWh exercise price, the option fee is $50. Calculate the generator output power and option exercises to maximize its profit if (assume the generator cannot be shut down) 1. The spot market price is $22/MWh; 2. The spot market price is $33/MWh. A generator has 100 MWh generation capacity and has the following production cost curve C(q) = 200 + 20g +0.1q² It enters the operating day with the following contracts: Seller of a forward contract of 30$/MWh and a quantity of 10 MWh; Seller of a forward contract of 50$/MWh and a quantity of 5 MWh; Buyer of a forward contract of 25$/MWh and a quantity of 5 MWh; • A 5 MWh put option with 285/MWh exercise price, the option fee is $100. . • A 10 MWh call option with 30$/MWh exercise price, the option fee is $50. • A 5 MWh call option with 35$/MWh exercise price, the option fee is $50. Calculate the generator output power and option exercises to maximize its profit if (assume the generator cannot be shut down) 1. The spot market price is $22/MWh; 2. The spot market price is $33/MWh.
Expert Answer:
Answer rating: 100% (QA)
1 The generator will produce 10 MWh to satisfy the first forward contract 5 MWh to satisfy ... View the full answer
Related Book For
Posted Date:
Students also viewed these organizational behavior questions
-
Julius I. Tornado is the chief operating officer of Green Valley. One day last week he came to your office to discuss the terms of a new bond issue the city plans to sell. The proceeds from these...
-
The chief operating officer (COO) has noticed that production employees in the companys Mexican manufacturing operations are unhappy with some of the production engineering decisions made by...
-
The chief operating officer of the Wisconsin Corporation is considering the effect of depreciation on company ROI. In the most recent year, net operating profit after taxes was $30,000,000 and...
-
Your friend, Daniel Nat, recently began work as the lead accountant for Asheville Company. Dan prepared the following balance sheet for December 31, 20Y5: Asheville Company Balance Sheet December 31,...
-
Is Matthews correct that her termination constituted unlawful discrimination under Title VII?
-
The following diagram shows two reference variables pointing to the same Bunny object in memory. The reference variable myBunny is of type Bunny, while unknownBunny is a valid but unknown data type....
-
The pressure rise, \(\Delta p\), across a blast wave, as shown in Fig. P7.61, is assumed to be a function of the amount of energy released in the explosion, \(E\), the air density, \(ho\), the speed...
-
Lightle, a real estate agent in Anchorage, listed a house for sale by the Leighs. The Williamses made an offer to buy the house, and the offer was accepted, conditional on their obtaining a mortgage....
-
Smithson Electric provides residential and business electric repair services. While direct labor and materials costs are traced to individual customers, administrative labor and transportation costs...
-
Steve and Cher put $2,400 into a college fund every year for their son, Don, on his birthday, with the first deposit one year from his birth (at his very first birthday). The college fund has a...
-
5- The lift slope for an airfoil is 0.1123 degree-, and az-o = -0.8. Consider a finite wing using this airfoil, with AR = 6 and taper ratio = 0.8. Assume that 6 = T. Calculate the lift coefficient...
-
Are the asymmetric information problems associated with the international firms more severe than those for local (domestic) firms? Explain. Different regulation in terms of tax, accounting standard,...
-
Mike needs to borrow $7,500 for five years. The loan will be repaid in one lump sum at the end of the loan term. What interest rates is best for Mike? Explain why interest rate is best. are you in...
-
A speculator buys a call option for $2, with an exercise price of $41. The stock is currently priced at $33 and the price becomes $67 on the expiration date. What is the stock price at which the...
-
You are auditing the financial statements of a cosmetics distributor that sells thousands of individual items. The distributor keeps its inventory in its distribution center and in two public...
-
EB Corporation, a calendar year C corporation, reports net income of $ 2 . 3 billion on its 2 0 2 3 financial statements, including financial statement depreciation of $ 3 0 0 million. Also, for 2 0...
-
Examine the following C++ program and give its output. (1 mark). #include #include #include using namespace std; void search vector & vec, int val) { } cout < < "searching for " < < val < < " ... ";...
-
A researcher reports a significant two-way between-subjects ANOVA, F(3, 40) = 2.96. State the decision to retain or reject the null hypothesis for this test.
-
Parker Feeders manufactures bird feeders for wild bird specialty stores. In September, Parker Feeders received an order from Wild Birds, Inc., for 30 platform bird feeders. The order from Wild Birds,...
-
Polly Products is a recycled plastics manufacturer located in Mulliken, Michigan. It makes plastic lumber called Polly Planks from 100% recycled plastics. It also builds park benches, picnic tables,...
-
Refer to the Crystal Springs Filtration Department Data Set and your answer to S5- 15. Complete Steps 3 and 4 of the process costing procedure: Summarize total costs to account for and then compute...
-
A 50 -W incandescent light bulb emits about \(5.0 \mathrm{~W}\) of visible light. (The rest is converted to thermal energy.) If a circular aperture \(5.0 \mathrm{~mm}\) in diameter is placed \(1.0...
-
Consider the diffraction pattern shown actual size in Figure 34.40. If the pattern was formed by light from a \(623-\mathrm{nm}\) (red) laser passing through a single narrow slit and the screen on...
-
Eyeglass lenses made of crown glass \((n=1.52)\) are given a thin coating of magnesium fluoride \((n=1.38)\) to minimize reflection of light from the lens surface. What is the minimum coating...
Study smarter with the SolutionInn App