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Andrei [34K]
3 years ago
7

The average annual return over the period 1926-2009 for the S&P 500 is 12.0%, and the standard

Business
1 answer:
arsen [322]3 years ago
5 0

Answer:

C) -30.6%, 54.6%

Explanation:

95% Confidence Interval = (Average Return - 2*Standard Deviation, Average Return + 2*Standard Deviation)

=(0.12 - 2*0.213, 0.12 + 2*0.213)

= -30.6%,54.6%

Therefore, The 95% confidence interval for  2010 returns is -30.6%,54.6%.

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Which of the following statements is CORRECT? a. The reported income of two otherwise identical firms cannot be manipulated by d
Delicious77 [7]

Answer: The correct answer is "d. The income statement for a given year is designed to give us an idea of how much the firm earned during that year.".

Explanation: The statement "d. The income statement for a given year is designed to give us an idea of how much the firm earned during that year." is CORRECT because In accounting, the income statement is a financial statement that shows in an orderly and detailed way how the result of the year was obtained during a given period.

This financial statement is closed, since it covers a period during which the costs and expenses that gave rise to its income must be perfectly identified. Therefore, it must be perfectly applied at the beginning of the accounting period so that the information presented is useful and reliable for decision making.

8 0
3 years ago
A new employee, John Chapman, earns $10 per hour and gets time-and-a-half over 40 hours per week. His first week he worked 45 ho
nirvana33 [79]

Answer: $475

Explanation:

Gross pay is:

= Regular pay + Overtime

= (Regular hours * Regular pay) + ( Overtime hours * regular pay * time and a half)

= (10 * 40 hours) + ( (45 - 40 hours) * 10 * 1.5)

= 400 + 75

= $475

6 0
3 years ago
Franklin Corporation is comparing two different capital structures, an all-equity plan (Plan I) and a levered plan (Plan II). Un
expeople1 [14]

Answer and Explanation:

The computation is shown below:

a. The price per share under MM proposition is

= Debt ÷ Difference in Number of shares

= $1,330,000 ÷ (155,000 - 105,000)

= $26.60

b. The value of the firm under each plans is

For All equity plan

= Share price × Number of shares

= $26.6 × 155,000 shares

= $4,123,000

For Levered plan

= All equity plan value + Debt × Tax rate

= $4,123,000 + $1,330,000 × 0%

= $4,123,000

8 0
3 years ago
What can be used to replicate a protective put strategy?
Sliva [168]

Answer:

call option and riskless investment

Explanation:

A protective put strategy is a term often referred to as married put that describes a form of risk-management strategy, whereby an investor used options contracts to protect the shares of a stock or other asset against a loss.

A call option and riskless investment, on the other hand, is a term that describes an agreement to between buyer and seller to exchange a tradeable finance asset at a set price. It is considered to have a net pay off similar to protective put strategy.

Also, a riskless investment is a theoretical term that describes a form of investment such as savings, with a specific rate of return and less to no chance of default.

Hence, what can be used to replicate a protective put strategy is CALL OPTION and RISKLESS INVESTMENT

3 0
3 years ago
Evaluating risk is an important part of the capital budgeting process. Which of the following is measured by the variability of
Phantasy [73]

Answer:

(B). Stand-alone risk

Explanation:

Stand-alone risk is the risk resulting from a single isolated project.

The <u>stand-alone risk varies inversely with the project's expected returns.</u>

When expected return of the project is high, the stand-alone risk is low and when the expected return is low, the stand-alone risk is high.

4 0
3 years ago
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