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IgorC [24]
1 year ago
6

if the market risk premium is 7%, the risk-free rate is 2% and the beta of a stock is 2.0, what is the expected return of the st

ock?
Business
1 answer:
Len [333]1 year ago
3 0

Expected return of the stock is greater than 12%.

Using formula, Risk free rate + beta (market risk rate - risk free rate)\

= 2% + 2.0 (7%-2%)

= 13.6 - 0.4* risk premium

Risk premium of a stock is greater than 12%.

A stock's total return takes into account both capital gains and losses as well as dividend income, as opposed to a stock's nominal return, which only displays its price movement. In addition to considering the actual rate of return, investors should consider their ability to withstand the risk involved with a given investment. An investment's return on investment (ROI) provides a general indication of its profitability. The return on investment (ROI) is calculated by subtracting the investment's initial cost from its final value, dividing the result by the cost of the investment, and finally multiplying the result by 100.

Note that the full question is:

If the market risk premium is 7%, the risk-free rate is 2% and the beta of a stock is 2.0, what is the expected return of the stock?

A. less than 12%.

B. 12%.

C. greater than 12%.

D. cannot be determined.

To learn more about returns: brainly.com/question/24301559

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Need help ASAP please answer this
BaLLatris [955]

The sum of the bank's total amount of liabilities and net worth is $5002 million.

<h3>How to calculate the values?</h3>

The sum of the bank's total amount of liabilities and net worth will be:

= Total reserves + Loans + Securities + Other assets.

= 268 + 3653 + 949 + 132

= $5002 million

The additional amount of loans that the bank can make to household and firm is $8 million. This is simply the value of the excess reserve.

The current quantity of transaction deposits at the bank will be:

(Total reserve - Excess reserve) = Transactions deposit × Reserved ratio

(268 - 8) = Transaction deposit × 10%

260 = Transaction deposit × 10%

Transactions deposit = 260/10%

Transaction deposit = $2600 million = $2.6 billion

Learn more about net worth on:

brainly.com/question/27218751

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8 0
2 years ago
i need to know whether you are able to perform the following functions of the job, revising existing marketing materials, promot
Natalija [7]

I want to know if you're capable of updating current marketing materials, promoting the business at trade fairs, and contacting potential clients through direct mail campaigns.

How do you recognize prospective clients?

Divide Up Your Potential Clientele. The first step in locating and comprehending your potential consumer base is segmenting your current customer base.

Research rivals.

Create a marketing plan for a healthy brand.

Recognize Changing Consumer Demands and Behaviours.

Customer and potential customer definitions

Customers are current users who consume our products, services, or other offerings and express interest in our brand. Potential clients are individuals who haven't yet used our services but are likely to be interested clients in the future.

To know more about potential customer

brainly.com/question/3053467

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6 0
2 years ago
A type of partnership called a ___________ acts much like a corporation and is traded on stock exchanges, but it is taxed like a
Gekata [30.6K]
The answer is:  <u>  master limited partnership ; or, "MLP" </u><u /> .
___________________________________________________________
4 0
3 years ago
define the procedures that different computers follow when they transmit and receive data.A) ConsolesB) PortsXC) ProtocolsD) Hos
Otrada [13]

Answer:

C. Protocols

Explanation:

Protocols -

It consists of the set of rules which enables communication between two or more system where the data and information can be transferred is referred to as protocol .

Protocol have some defined syntax and rules .

Protocol can be implemented on both software as well as software.

Hence , from the given statement of the question,

The correct term is protocol .

3 0
3 years ago
Smith Corporation makes and sells a single product called a Pod. Each Pod requires 2.4 direct labor-hours at $10.60 per direct l
kramer

Answer:

$585,120

Explanation:

The computation of Budgeted direct labor costs is shown below:-

Direct labor cost per pod = Direct labor required per pod x Direct labor rate

= 2.4 × $10.60

= $25.44

Budgeted direct labor costs incurred in June = Direct labor cost per pod × Produced pods

= $25.44 × 23,000

= $585,120

Therefore for computing the budgeted direct labor costs we simply applied the above formula.

4 0
3 years ago
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