1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
IRISSAK [1]
3 years ago
6

"Sydney has a portfolio with 50 shares of AAA with a current value of $20 per share, a return of 12%, and a beta of 1.30. She al

so has 25 shares of BBB with a return of 10%, a 0.80 beta, and currently priced at $60 per share. Finally she owns 75 shares of CCC priced at $50 per share, with a 1.1 beta and a 14% return. What is the weighted average portfolio return of Sydney s portfolio
Business
1 answer:
Nezavi [6.7K]3 years ago
6 0

Answer: 12.72%

Explanation:

Given the following information ;

50 Shares of AAA at $20 and expected returns of 12%

25 Shares of BBB at $60 and expected returns of 10%

75 Shares of CCC at $50 and expected returns of 14%

Total value of the portfolio ;

Total Portfolio Value = ( 50×20 ) + ( 25×60 ) + ( 75×50 )

= 1000 + 1500 + 3750 = $6,250

Weight of each share in the portfolio;

Weight of Stock AAA = ( 50×20 ) / 6250 = 0.16

Weight of Stock BBB = ( 25×60 ) / 6250 = 0.24

Weight of Stock CCC = ( 75×50 ) / 6250 = 0.60

Expected return on portfolio is calculated thus;

Expected Portfolio Return = ( Weight of AAA×Expected Returns ) + ( Weight of BBB×Expected Returns ) + ( Weight of CCC×Expected Returns )

Expected Portfolio Return = ( 0.16×0.12 ) + ( 0.24×0.10 ) + ( 0.60×0.14 )

Expected portfolio return = (0.0192+0.024+0.084) = 0.1272

0.1272 = 12.72%

You might be interested in
Joseph is an unemployed yard landscaping worker who is trying to find employment as he last had work seven months ago. He is now
Mandarinka [93]

Answer:

Cyclical Unemployment

Explanation:

Cyclical Unemployment occurs due to irregularities surrounding an economy and these said cycles eventually brings about recession and thus, a good number of willing workers would not be able to get jobs due to this fact. What Joseph is experiencing is called Cyclical unemployment.

3 0
3 years ago
A company purchases equipment for $32,000 cash. This transaction should be shown on the statement of cash flows under:________
omeli [17]

Answer:

b. investing activities

Explanation:

Cash flow can be defined as the net amount of cash and cash-equivalents that is flowing into (received) and out (given) of a business. There are three components of the cash flow;

1. Operating cash flow: all cash generated from the business activities of an organization.

2. Financing cash flow: all payments made by an organization and profits from issuance of debts and equity.

3. Investing cash flow: costs associated with purchasing of capital assets and investments of cash resources in other businesses.

A company purchases equipment for $32,000 cash. This transaction should be shown on the statement of cash flows under investing activities.

Generally, investing activities comprises of purchasing physical assets, investing in securities and the sale of assets or securities associated with the company.

<em>Hence, a company that purchases equipment for $32,000 cash should show the transaction on the statement of cash flows under investing activities.</em>

4 0
3 years ago
The ________ is an incomplete picture because a single number cannot fully reflect the sources of the underlying differences in
Sveta_85 [38]

Answer:

Income inequality ratio

Explanation:

The income inequality ratio is an incomplete picture because a single number cannot fully reflect the sources of the underlying differences in income.

Income inequality refers to the uneven distribution of income among the population of a particular place. It is the difference in the allocation of income in a particular country.

Income inequality occurs across different segments of the population such as gender(male and female), ethnic group, occupation, geographical location etc.

The Gini index is widely used to compare disparities in income.

6 0
3 years ago
A monopolist maximizes profits by:
klemol [59]

Answer:

c) by setting MR(q)=MC(q) at a q for which p(q) is at least AVC(q)

Explanation:

Profit is maximised at MR= MC and price is greater than MC for monopoly.

6 0
3 years ago
Sells Company accounts for its investment in OFO, Inc. under the available-for-sale method. How should Sells Company record a ca
ohaa [14]

Answer:

the journal entry should be:

Dr Cash X

    Cr Dividend revenue X

When a company holds securities as an investment and classifies them as available for sale (AFS), any dividends received will be recorded as revenue.

Dividend revenue is reported in the income statement.

7 0
3 years ago
Other questions:
  • Earlier, it was noted that you might be in the position where your firm is contemplating a layoff, though employees are not awar
    11·1 answer
  • On December 28, 2021, Videotech Corporation (VTC) purchased 12 units of a new satellite uplink system from Tristar Communication
    5·1 answer
  • Elegant Decor Company's management is trying to decide whether to eliminate Department 200, which has produced losses or low pro
    8·1 answer
  • Case ScenarioOver the past four years, the LSS organization, a nonprofit organization headquartered in Minneapolis, MN, has beco
    12·1 answer
  • People want to view their leaders as ethical, fair, and just, especially with the public failing of high-level leaders in the pa
    11·1 answer
  • Olde manufacturing, a parts supplier to the auto industry, has been using the behavioral approach to management for over 100 yea
    6·1 answer
  • A firm has zero debt in its capital structure. Its unlevered cost of capital is 9%. The firm is considering a new capital struct
    10·1 answer
  • When a person gains a benefit from a previously unauthorized act of an agent and does not deny the authority to act after learni
    13·1 answer
  • In preparing closing entries
    15·2 answers
  • Which of the following statements is TRUE? *
    13·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!