All categories

1 year ago

A lower expected return means a higher risk will have to be accepted. true false

1 answer:

8 0

The statement "A lower expected return means a higher risk will have to be accepted. " Is false. This is further explained below.

<h3>What is the expected return?</h3>

Generally, According to the proverb, "A lower projected return indicates a bigger risk will need to be taken." Is false

In conclusion, The amount of profit or loss that an investor might anticipate obtaining as a result of the investment is referred to as the anticipated return. To get an anticipated return, first, multiply all of the possible outcomes by the percentage chance that each one will occur, and then add up all of those products. It is impossible to provide a guarantee on expected returns.

You might be interested in

Due to a recession, expected inflation this year is only 4.25%. However, the inflation rate in Year 2 and thereafter is expected

deff fn [24]

Answer:

Explanation:

Yield on 1 year trasury bond: r1=4.25+3.5 = 7.75%

Now, yield is r3 = 7.75+1.5 = 8.25%

r3=r*+inf

8.25=3.5+inf

inf=4.75%

4.75 = (4.25+i+i)/3

14.25 = 4.25 +2i

2i = 10

i = 5%

Inflation expected after year 1 is 5%

7 0

3 years ago

A firm's cost of equity is 22%. Its before-tax cost of debt is 13% and its marginal tax rate is 21%. The firm's capital structur

alisha [4.7K]

Answer:

WACC= 17.95%

Explanation:

Weighted average cost of capital is the average cost of all of the long-term types of finance used by a company weighted according to the that amount of finance used in relation to the total pool of fund.

It is calculated using the formula below:

WACC = (We×Ke) + (Wd×Kd)

Ke-cost of equity- 22%

We- equity weight- 100% - 45% = 55%

Kd-After tax cost of debt-10.3%

Wd- 45%

After tax cost of debt = Before tax ×× (1- tax rate)

After tax cost of debt = 13%× (1-0.21) = 10.3%

Cost of equity = 22%

WACC =(0.55× 22%) + (0.45× 13%)=17.95%

WACC= 17.95%

4 0

3 years ago

In America, being "normal" is

Stella [2.4K]

Being selfish I guess

7 0

2 years ago

Port Orleans Shipping markets different services to the tourism, defense, and trade segments. The firm designs separate offers f

gayaneshka [121]

Answer: The correct answer is "differentiated".

Explanation: This approach is called <u>differentiated</u> marketing since the firm deals with studying each segment, that is, tourism, defense and commerce, and identifying their needs to make individual offers to each segment instead of making general offers for all segments equally.

3 0

3 years ago

"Ethan knows that when he graduates from college and begins looking for a job, he will need to make his resume stand out from al

kakasveta [241]

Answer:

Communicating value

Explanation:

Communicating value involves showing others what makes one's product or skills different and better than others that are available.

What value means to stakeholders in a situation needs to be defined.

Focus is then given to how the skill or product can meet these unique needs.

Also one needs to understand the most effective platform to use in communicating value.

In this instance Ethan wants to make his resume stand out from all the other resumes that the company receives in order to be selected for an interview

He is communicating the value he can add to the company.

5 0

2 years ago