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Licemer1 [7]
3 years ago
7

Suppose that two factors have been identified for the U.S. economy: the growth rate of industrial production, IP, and the inflat

ion rate, IR. IP is expected to be 4%, and IR 2.0%. A stock with a beta of 2.5 on IP and 1.8 on IR currently is expected to provide a rate of return of 12%. If industrial production actually grows by 6%, while the inflation rate turns out to be 5.5%, what is your revised estimate of the expected rate of return on the stock
Business
1 answer:
DENIUS [597]3 years ago
5 0

Answer:

23.3%

Explanation:

Expected return refers to the anticipated profit or loss of financial investment. Essentially, it's the value of the return that investors anticipate. We can find the expected return by using the formula given below

Δ IR = 5-5% - 2% = 3.5%

Δ IP = 6% - 4% = 2%

Formula

Expected return = Expectedreturn(previous year) + (betaIP x Δ IP) + (betaIR x Δ IR)

Expected return = 12% + (2.5 x 2%) + (1.8 x 3.5%)

Expected return = 23.3%

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General Motors increases the price of a model car produced exclusively for export to Europe. Which U.S. price index is affected?
alexira [117]

Answer: The GDP deflator

Explanation: The GDP(gross domestic product) deflator is a price index that is used to measure the prices of all the goods and services produced within an economy. The cars which are exported by General Motors are produced domestically within the United States of America and exported outside the country.

Any goods produced externally are not considered when determining the GDP deflator.

4 0
3 years ago
Service Department Cost Activity Base for Allocation Graphics Production $200,000 number of copies Accounting 500,000 number of
Mandarinka [93]

Answer:

$350,000

Explanation:

Production =  $200,000 number of copies

Accounting = $500,000 number of invoices processed

Personnel Department = $400,000 number of employees

These are all service cost

Total number of copies = 20,000 + 30,000 + 50,000 = 100,000

Total number of invoices processed = 700 + 800 + 500 = 2,000

Total number of employees = 130 + 145 + 125 = 400

Rate per service shall be as follows:

Production = $200,000/100,000 = $2 per copy

Cost of Super Division = $2 \tiimes 50,000 = $100,000

Accounting = $500,000/2,000 = $250 per invoice

Cost of Super Division = $250 \tiimes 500 = $125,000

Personnel Department = $400,000/400 = $1,000 per employee

Cost of Personnel Department = $1,000 \tiimes 125 = $125,000

Total service cost of Super Department = $100,000 + $125,000 + $125,000

= $350,000

8 0
3 years ago
What type of corporate speech can be fully regulated?
Stels [109]

Answer: The correct answer is "(A) Advertising".

Explanation: The publicity for its diffusion and consequences in front of third parties and legal regime is the type of corporate discourse that can be completely regulated with the aim of not causing damage to the rights of potential consumers.

8 0
3 years ago
Read 2 more answers
According to libertarians, the government should redistribute income from rich individuals to poor individuals to achieve a more
devlian [24]

Answer:

b. False

Explanation:

In the United States of America, the libertarians refers to a group of people or individuals who have the philosophical views of promoting individual freedom and liberty among the people. Thus, the primary political strength, values and ideas of a libertarian is individual freedom and liberty.

Saying libertarians wants the government to redistribute income from rich individuals to poor individuals to achieve a more equal distribution of income is a false statement because the libertarians simply cares about the means being just but not concerned about the outcome of a process or event.

3 0
2 years ago
Although the average annual price for a four-year public college is roughly $8,600, how much does the average student pay after
djverab [1.8K]

In general, after a student applies gift aid to public college fees, they get to pay<u> less than $3,000.</u>

Gift aid refers to financial support towards one's education that they do not have to pay back. The various forms include:

  • Scholarships
  • Grants

When students get both of these, it can reduce the amount they have to pay for college by more than 50% such that they only end up paying less than $3,000 in public universities.

In conclusion, gift aid helps public college students pay less than $3,000 in college fees.

<em>Find out more at brainly.com/question/20087400. </em>

4 0
2 years ago
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