Elevator pitch project

What is an advantage of an adjustable-rate mortgage?

Anastaziya [24]

A drop in interest will result in lower payments because of its overall discretion value

9 0

3 years ago

The stock of Big Joe's has a beta of 1.64 and an expected return of 13.30 percent. The risk-free rate of return is 5.8 percent.

larisa86 [58]

Answer:

expected return on market = 0.10373 or 10.373%

Explanation:

Using the CAPM, we can calculate the required/expected rate of return on a stock. This is the minimum return required by the investors to invest in a stock based on its systematic risk, the market's risk premium and the risk free rate.

The formula for required rate of return under CAPM is,

r = rRF + Beta * rpM

Where,

rRF is the risk free rate

rpM is the market risk premium

We will first calculate the market risk premium using the required rate of return for stock, beta and risk free rate and plugging these values in the formula above.

0.1330 = 0.058 + 1.64 * rpM

0.1330 - 0.058 = 1.64 *rpM

0.075 = 1.64 * rpM

rpM = 0.075 / 1.64

rpM = 0.04573 or 4.573%

As we know that the beta for market is always equal to 1, we can calculate the rate of return for market as,

expected return on market = 0.058 + 1 * 0.04573

expected return on market = 0.10373 or 10.373%

7 0

3 years ago

Joe Santos owns the only pizza parlor in a small town that is also home to a McDonald's, a Taco Bell, and a Kentucky Fried Chick

astra-53 [7]

Answer:

True

Explanation:

A more precise way to describe the situation is that Joe's pizza parlor is a monopolistic competition. But that definition considers that all 'food' items have some degree of close substitute relation.

But yes, if you consider this two conditions:

a broad definition of monopoly
other restaurants are not considered close substitutes for the food sold at the pizza parlor

Then yes, Joe has monopoly

5 0

3 years ago

Glenn is purchasing a home for $400,000. the property appraised at $415,000 and glenn is financing $300,000. what's the loan-to-

bazaltina [42]

Answer:

75%

<h3>Explanation:</h3>

Lenders use the lesser of the sales price or appraised value to calculate the loan-to-value ratio (LTV).
This results in LTV of 75% ($300,000/$400,000).

<h3>How do you calculate the loan-to-value ratio?</h3>

To figure out your LTV ratio, divide your current loan balance (you can find this number on your monthly statement or online account) by your home's appraised value.
Multiply by 100 to convert this number to a percentage. Caroline's loan-to-value ratio is 35%.

To learn more about it, refer

to brainly.com/question/25689052

#SPJ4

8 0

1 year ago

The comparative balance sheets for 2021 and 2020 are given below for Surmise Company. Net income for 2021 was $88 million.

Alinara [238K]

It can be deduced that the cash flow shows that the net cash provided by operating activities will be $58 million.

<h3>How to compute the statement of cash flow</h3>

<u>Cash flow from operating activities</u>

Net income = $54 million

Add: Depreciation $15 million.

Add: Bad debt = $6 million

Add: Amortization expense = $3

<u>Changes in operating assets and liabilities</u>

Decrease in account receivable = $4 million

Increase in inventory = ($9 million)

Increase in prepaid expense = ($2 million)

Decrease in account payable = ($10 million)

Decrease in accrued liability = ($3 million)

Net cash provided by operating activities = $58 million

In conclusion, the net cash provided by operating activities is $58 million.

Learn more about cash flow on:

brainly.com/question/735261

8 0

1 year ago