Answer:
Required rate of return on clover's stock is 8.99%
Explanation:
The required rate of return on Clover's stock can be computed using Miller and Modgliani capital asset pricing model formula given below:
Ke=Rf+beta*(Rm-Rf)
Ke is the required rate of return, the unknown
Rf is the risk free rate of return of 4.00%
beta for Clover is 0.80
Rm is the not known as well but can computed using the Parr paper's details below:
beta is 1.442
required return IS 13%
13.00%=4.00%+1.442*(Rm-4.00%)
13%-4%=1.442*(Rm-4.00%)
9%=1.442*(Rm-4.00%)
9%/1.442=Rm-4%
6.24%
=Rm-4%
Rm=6.24%+4%
Rm=10.24%
Now the required return on Clover's stock can be computed
Ke=4%+0.8*(10.24%-4%)
Ke=8.99%
Answer: The answer is b. Reduce output in the short run.
Explanation: In production, to determine the quantity of products to supply, the demand of the consumer plays a very vital role. This is because the consumer demand will determine the price at which a company will sell its products.
In the case of Techno above, they would do well to reduce the output in the short run, since demand has reduced, pending when the demand increases. This is because if they maintain their current output of 3000 TV sets per week, they will sell less units and their revenue (price x quantity sold) will be lower than their cost and this will lead to them incurring loss.
So until the recession scare passes, output should be reduced in the short run.
honestly you would need all of them because they are very important to have as you get older
I think it would either be potential markets or target markets but i would probably choose target markets
Answer: There would be an increase on return on investment (ROI) if current assets decrease while everything else remains the same
Explanation: This is because when the profit(returns) is constant, but the assets drops in value, the new ROI will be relative drop in value of asset.
