Answer: Stock B
Explanation:
Use CAPM to calculate the required returns of both stocks.
Stock A
Required return = Risk free rate + beta * ( Market return - risk free rate)
= 5% + 1.20 * (9% - 5%)
= 9.8%
Stock B
Required return = 5% + 1.8 * (9% - 5%)
= 12.2%
Both of them have Expected returns that are higher than their Required returns so both of them are good buys.
The better buy would be the one that has more expected value excess over required return.
Stock A excess = 10% - 9.8% = 0.2%
Stock B excess = 14% - 12.2% = 1.8%
<em>Stock B offers a higher excess and is the better buy. </em>
Answer:
The answer is "$400"
Explanation:
Given:
advance payment = $ 1,000
by the end of year he earned= $ 400
So, the total eared value is $ 400 because it is the Debit unearned income.
Answer:
B&T Company's factory overhead incurred for May is $8,890
Explanation:
Manufacturing overhead is all indirect costs incurred during the production process, includes indirect labor cost.
In B&T Company,
Factory overhead incurred for May = Indirect labor cost + property taxes on production facility cost + factory heat, lights and power cost + insurance on plant and equipment cost = $6,800 + $830 + $1,030 + $230 = $8,890
The best way for Mariposa to finance the remaining balance on her car is installment credit. The correct answer is C.
Turning a draft budget into spending bills.
