Ask question

Ask question

All categories

3 years ago

6

Your portfolio is comprised of 30 percent of stock X, 25 percent of stock Y, and 45 percent of stock Z. Stock X has a beta of 1.

16, stock Y has a beta of 1.47, and stock Z has a beta of 0.42. What is the beta of your portfolio

1 answer:

Evgesh-ka [11]3 years ago

6 0

Answer:

The beta of your portfolio is 0.9045

Explanation:

Hope this help :D

You might be interested in

Both Bond Sam and Bond Dave have 7.3 percent coupons, make semiannual payments, and are priced at par value. Bond Sam has three

Ainat [17]

Answer:

-5.14 for sam

-18.01% for dave

Explanation:

We first calculate for Sam

R = 7.3%

We have 2% increase

= 9.3%

We calculate for present value of coupon and present value at maturity using the formula for present value in the attachment

To get C

1000 x 0.073/2

= 36.5

time= 3 years x 2 times payment = 6

Ytm = rate = 9.3%/2 = 0.0465

Putting values into the formula

36.5[1-(1+0.0465)^-6/0.0465]

= 36.5(1-0.7613/0.0465)

36.5(0.2385/0.0465)

= 36.5 x 5.129

Present value of coupon = 187.20

We solve for maturity

M = 1000

T = 6 months

R = 0.0465

1000/(1+0.0465)⁶

= 1000/1.3135

Present value = 761.32

We add up the value of present value at maturity and that at coupon

761.32 + 187.20

= $948.52

Change in % = 948.52/1000 - 1

= -0.05148

= -5.14 for sam

We calculate for Dave

He has 20 years and payment is two times yearly

= 20x2 = 40

36.5 [1-(1+0.0465)^-40/0.0465]

Present value = 36.5 x 18.014

= 657.511

At maturity,

Present value = 1000/(1+0.0465)⁴⁰

= 1000/6.1598

= 162.34

We add up these present values

= 657.511+162.34 = $819.851

Change = 819.851/1000 -1

= -0.1801

= -18.01%

4 0

2 years ago

You have just won the lottery and will receive $460,000 in one year. You will receive payments for 27 years, and the payments wi

Zepler [3.9K]

Answer:

The present Value of my winnings = $4,578,716.35

Explanation:

An annuity is a series od annual cash outflows or inflows which payable or receivable for a certain number of periods. If the annual cash flow is expected to increase by a certain percentage yearly, it is called a growing annuity.

To work out the the present value of a growing annuity,

we the formula:

PV = A/(r-g) × (1- (1+g/1+r)^n)

I will break out the formula into two parts to make the workings very clear to follow. So applying this formula, we can work out the present value of the growing annuity (winnings) as follows.

A/(r-g)

= 460,000/(12%-3%)

= $5,111,111.11

(1- (1+g/1+r)^n

1 - (1+3%)/(1+12%)^(27)

=0.8958

PV = A/(r-g) × (1- (1+g/1+r)^n)

$5,111,111.11 × $0.8958

= $4,578,716.35

The present Value of my winnings = $4,578,716.35

5 0

3 years ago

The interest rate that lenders publish or advertise is usually:

ivann1987 [24]

Answer:

It’s A the nominal interest rate

Explanation:

8 0

2 years ago

The Bradford Company issued 12% bonds, dated January 1, with a face amount of $87 million on January 1, 2021. The bonds mature o

kakasveta [241]

Answer:

1. $77,783,220

2. Jan-21

Dr Cash $ $77,783,220

Dr Discount On Bond $9,216,780

Cr Bond Payable $ $87,000,000

Explanation:

1. Calculation to Determine the price of the bonds at January 1, 2021.

First step is to calculate the Present Value Of Annual Interest

a Semi-annual Interest Amount $5,220,000

($87,000,000*12%/2)

b PV Annuity Factor for (20 Years,14%/2=7%) 10.5940

c Present Value Of Annual Interest (a*b) $ $55,300,680

($5,220,000*10.5940)

Second step is to calculate Present Value Of Redemption Amount

a Redemption Value $ $87,000,000

b PV Factor Of (20 Years,7%) 0.25842

c Present Value Of Redemption Amount (a*b) $ $22,482,540

($87,000,000*0.25842 )

Now let Determine the price of the bonds at January 1, 2021.

Intrinsic Value ( Price ) Of The Bond = ($55,300,680+$22,482,540)

Intrinsic Value ( Price ) Of The Bond =$77,783,220

Therefore the price of the bonds at January 1, 2021 is $77,783,220

2. Preparation of the journal entries to record their issuance by The Bradford Company on January 1, 2021,

Jan-21

Dr Cash $ $77,783,220

Dr Discount On Bond $9,216,780

($87,000,000-$77,783,220)

Cr Bond Payable $ $87,000,000

(Being to record issuance of bond)

3. Preparation of the journal entries to record their issuance by The Bradford Company on ion June 30, 2021

Jun-30

Dr Interest expenses $ 53,82,240

Discount On Bond payable $ 2,22,240

Cash $5,220,000

4.Preparation of the journal entries to record their issuance by The Bradford Company on

December 31, 2021

Dec-31 Interest expenses $ 53,97,797

Discount On Bond payable $ 2,37,797

Cash $5,220,000

( to record interest payment)

6 0

3 years ago

Bledsoe Corporation has provided the following data for the month of November: Beginning Ending Raw materials $ 25,100 $ 21,100

tamaranim1 [39]

Answer:

Bledsoe Corporation

Schedule of Cost of goods manufactured

Particulars Amount

Direct materials:

Beginning material inventory $25,100.00

Add: Purchases <u>$72,100.00</u>

Raw material available for use $97,200.00

Less: Ending material inventory <u>$21,100.00</u>

Raw material used in production $76,100.00

Less: Indirect material <u>$4,010.00 </u> $72,090.00

Direct labor $92,100.00

Manufacturing overhead applied <u>$41,100.00</u>

Total manufacturing costs $205,290.00

Add: Beginning WIP <u>$17,100.00</u>

Total cost of work in process $222,390.00

Less: Ending WIP <u>$10,100.00</u>

Cost of goods manufactured <u>$212,290.00</u>

Bledsoe Corporation

Schedule of COGS

Particulars Amount

Cost of goods sold:

Beginning finished goods inventory $48,100.00

Add: Cost of goods manufactured <u>$212,290.00</u>

Cost of goods available for sale $260,390.00

Less: Ending finished goods inventory <u>$56,100.00</u>

Unadjusted cost of goods sold $204,290.00

Add: Underapplied overhead <u>$1,010.00 </u>($42,110 - $41,100)

Adjusted cost of goods sold <u>$205,300.00</u>

3 0

2 years ago