All categories

3 years ago

Three months ago, you purchased a stock for $54.14. The stock is currently priced at $57.36. What is the EAR on your investment?

Business

1 answer:

Crazy boy [7]3 years ago

5 0

Answer:

The EAR on the investment is 23.79%

Explanation:

Here, we are concerned with calculating the EAR on the stock investment.

Firstly, we start with calculating the return on shares

Mathematically, that is; P1 - P0

From the question P1 = $57.36 while P0 = $54.14

So Return on shares = $57.36-$54.14 = $3.22

We proceed with calculating the Return on shares in percentage

Mathematically;

Return on shares in % = Return on shares/P0 * 100

= 3.22/54.14 * 100 = 5.95%

Lastly we calculate the effective annual interest;

The effective annual interest = 5.95%/3 * 12 = 23.79%

You might be interested in

Can someone please help me answer these questions?

steposvetlana [31]

Answer:

I think these are personal questions which means there is no right answer

6 0

2 years ago

uring December, Rainey Equipment made a $676,000 credit sale. The state sales tax rate is 6% and the local sales tax rate is 1.5

ExtremeBDS [4]

Answer:

Please refer to the below for the appropriate journal entry

Explanation:

Accounts receivable Dr $726,700

($676,000 + $50,700)

Sales revenue account Cr $676,000

Sale taxes payable account Cr $50,700

{(6% + 1.5%) × $676,000

7 0

2 years ago

Alice earned $12 per hour. What equation shows the relationship between her

LenaWriter [7]

The equation shows the relationship between her weekly salary (w), hours per week (h), and rate per hour (r) is:

$w = h \times r$

Solution:

Given that,

Alice earned $12 per hour

1 hour = $ 12

Find the number of hours in 1 week

1 day = 24 hours

1 week = 7 days

Therefore,

1 week = 7 x 24 = 168 hours

Let "h" be the hours per week

let "r" be the rate per hour

Let "w" be the rate per hour

From given,

r = $ 12

h = 168 hours

weekly salary = hours per week x rate per hour

$w = h \times r$

$w = 168 \times 12\\\\w = 2016$

Thus, she earns $ 2016 for 1 week

5 0

3 years ago

Read 2 more answers

Accessory Industries has 2 million shares of common stock outstanding, 1 million shares of preferred stock outstanding, and 100

Natalija [7]

Answer:

Equity is 0.29

Debt is 0.64

Preferred stock 0.07

Explanation:

WACC=Ke*E/V+Kd*D/V*(1-t)*Kp*P/V

However, the requirements of the question is weights of the bonds,equity and preferred stock which are E/V,D/V and P/V respectively

E is the value of equity=2,000,000*$22=$44,000,000

D is the value of debt =100,000*$1000*96%=$96,000,000

P is the value of prefered stock=1,000,000*$10.50=$10,500,000

Total firm's finance(V) $150,500,000

E/V=$44,000,0000/$150,500,000=0.29

D/V=$96,000,0000/$150,500,000=0.64

p/v=$10,500,000/$150,500,000=0.07

4 0

2 years ago

Read 2 more answers

Consumer demand for personal computers or smart devices ultimately determines the demand for the parts and materials involved in

Aliun [14]

Answer:

The correct answer is c. Derived demand .

Explanation:

Derived demand is the demand for goods and services that is generated as a result of the demand for other goods and services. This type of demand usually corresponds to the demand for factors or products, since the demand for a good or service may be related to the process necessary to produce another good or service, although it can affect both producers and consumers.

Derived demand can sometimes lead to an increase in the price of a marginal product, since the demand for the resources needed to produce a physical product also increases.

8 0

2 years ago