1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
posledela
3 years ago
6

homeworklib You want to evaluate three mutual funds using the information ratio measure for performance evaluation. The risk-fre

e return during the sample period is 6%, and the average return on the market portfolio is 19%. The average returns, residual standard deviations, and betas for the three funds are given below. Average Return Residual Standard Deviation Beta Fund A 20 % 4.00 % 0.8 Fund B 21 % 1.25 % 1.0 Fund C 23 % 1.20 % 1.2 The fund with the highest information ratio measure is Multiple Choice Funds A and C (tied for highest). Funds A and B (tied for highest). Fund A. Fund C. Fund B.
Business
1 answer:
bezimeni [28]3 years ago
5 0

Answer:

The fund with the highest ratio is Fund B.

Explanation:

Risk-free return = 6%

The average return on the market portfolio = 19%

The ratio equation formula is as follows:

FUND A: Return on fund - Risk free rate - Beta (Return on market portfolio -  Risk free rate)/Standard deviation of fund

FUND A : 20 - 6 - 0.8(19 - 6 ) / 4 = 0.9

FUND B : 21 - 6 - 1(13)/1.25 = 1.6

FUND C : 23 -6 - 1.2 (13 ) /1.2 = 1.167

Therefore, the fund with the highest ratio is Fund B.

You might be interested in
What most likely will happen if the pie maker continues to make additional pies? the marginal costs will continue to rise, incre
Over [174]
<span>The most probable thing that will happen if the pie maker keeps making additional pies is this: the marginal costs will continue to rise, increasing the total cost, while the marginal revenue remains the same, decreasing the profit. This is to assume that no buyer is interested in purchasing the pies at a certain period of time. </span>
4 0
3 years ago
Read 2 more answers
When the US government becomes aware of economic changes, the discovery is most likely to influence 1. how the nation allocates
snow_tiger [21]

Answer:

1. How the nation allocates resources

Explanation:

Government is the chief decision maker in any economic model because their power enables to allocate nation`s resources among economic unit. As such they keep watch on the economic changes and trends in order to make the best economic decision for the nation. When government becomes aware of economic changes, it will try to allocate resources efficiently and effectively based on signal given by the changes.

For example, if US government is aware that the economy is nearing recession, it will be put in preventive measures to escape the intending recession and make sure it allocates its scarce in efficient way among the economic units by spending more on capital projects, raising social empowerment spending and doing other necessary things.

So the discovery of economic changes will most likely influence how the nation allocates resources.

5 0
3 years ago
HELP ASAP! ACCURATE ANSWERS PLEASE! WILL GIVE BRANLIEST IF THE ANSWER IS GOOD
zlopas [31]

Answer: tell them what you observe and sometimes you will have to reward them such as candies in order to show them that they did a splendid job. This will let them realize that they did a great job.

Explanation:

4 0
3 years ago
Jan is risk-averse, but wants to earn the best rate of return in less than two years. which investment would most likely meet ja
oksian1 [2.3K]
Jan needs bonds-based mutual funds as an investment in which he wants to earn the best rate of return. It mostly consists of individual bonds wherein it is compiled in a portfolio. A bond fund when then produced incomes from underlying bonds measured in incomes. 
5 0
3 years ago
A company purchased a commercial dishwasher by paying cash of $5,000. The dishwasher's fair value on the date of the purchase wa
Fed [463]

Answer:

$5,700

Explanation:

Purchased of a commercial dishwasher + Incurred transportation costs+ Installation fees= Total recorded amounts

$5,000 + $400 + $300 = $5,700.

Therefore the amount that the company will record the dishwasher is $5,700 because the parking ticket should be expensed as incurred due to the fact that it is not a cost necessary to get the asset ready for use.

7 0
3 years ago
Other questions:
  • Melinda kept a record of her spending for the week. She spent $25 to put gas in the car, bought a new shirt for a total of $22.3
    9·1 answer
  • You are the manager of a theater. At present the theater charges the same admisssion price of $8 to all customers, regardless of
    6·1 answer
  • The payment for environmental services (psa) program in costa rica collects payments from the beneficiaries of ecosystem service
    11·1 answer
  • The Modigliani and Miller hypothesis suggests that capital structure doesn't matter. All of the following conditions need to be
    8·1 answer
  • Gienuine Products Inc. requires a new machine. Two companies have submitted bids, and you have been assigned the task of choosin
    5·1 answer
  • Michael works as a financial advisor in a doctor’s office. The two organizations that Michael most likely belongs to are the AFP
    10·2 answers
  • Tom is teaching jenny how to ice skate. both skaters, who are about the same size, are on the ice and wearing their skates. to h
    7·1 answer
  • Suppose the price of pepperoni falls. In the market for pizza, in which pepperoni of a popular ingredient, one would expect that
    15·1 answer
  • Greater pricing power is most likely to result from greater:A. unused capacity.B. market concentration.C. volatility in market s
    9·1 answer
  • If I have an F and have nothing to do. what should I do
    11·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!