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2 years ago

How does the relationship between risk and expected return serve to allocate capital in a market?

1 answer:

7 0

The relationship between risk and expected return serves to allocate capital in a market. Investors want to maximize return for a given level of risk, so capital flows to its most efficient use.

There is a positive correlation between the level of risk taken and the level of return expected. The greater the risk, the greater the expected return and the greater the likelihood of suffering a large loss.

The relationship between risk and expected return is called the risk-return relationship. This is a positive relationship because the more risk you take, the higher the required return that most people demand. Risk aversion describes a positive risk-reward ratio.

Learn more about risk and expected return at

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If the cost of housing increases by 10 percent, then, other things the same, the CPI is likely to increase by about:(A) 10 perce

djverab [1.8K]

Answer:

correct option is (D) 4 percent

Explanation:

given data

cost of housing increases = 10 percent

to find out

CPI is likely to increase by

solution

as other thing (CPI) Consume price index is likely to increase as

(CPI) Increase in Consume price index = 40 % of cost of housing increases ...................1

so (CPI) Increase in Consume price index = 40 % of 10%

Increase in Consume price index = 4%

so correct option is (D) 4 percent

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3 years ago

Yvonne works for a discount store that sells items only online. She is putting together a report and needs information pertainin

vazorg [7]

Answer:

encryption

Explanation:

i think

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3 years ago

Suppose there are three factories in Macroland and the following occurred in 2019: Metal, plastic and a car factory. Metal facto

BARSIC [14]

Answer:

$1120

Explanation:

The computation of the GDP is shown below:

Y = C + I + G + X

Here Y denotes the GDP

C denotes the consumption = $500 - $80 - $20 = $400 and 700 - 50 = $650

I denotes the investment = $

G denotes the government purchase = $20

X denotes the net exports = $50

So,

Y = $400 + $650 + 0 + $20 + $50

= $1120

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2 years ago

The graphic would indicate a market that is

olasank [31]

Answer:

yes it would

Explanation:

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2 years ago

Garrett Company provided the following information:

Shalnov [3]

Answer:

Correct option is C

<u>Overall operating income will decrease by $25,000.</u>

Explanation:

Sales ratio = Sales of product 1 : Sales of product 2 = 200,000:300,000 = 2:3

Sum of sales ratio = 2+3 = 5

Common fixed cost:

Product 1 = 2/5×46,000 = $18,400

Product 2 = 3/5×46,000 = $27,600

Total net operating income = Net operating income of product 1 + Net operating income of product 2 = 46,600+(2,600) = 46,600-2,600 = $44,000

Now, comparing with the total net operating income of both the product ($44,000) with only product 1 ($19,000); overall operating income decreases by $25,000 (44,000-19,000)

8 0

3 years ago