A stock has an expected return of 12 percent and a beta of 1.16, and the expected return on the market is 11 percent. Here, we are asked to find the risk free rate. We will find it using CAPM formula-
ER= rf+(rm-rf)*beta
12= rf+(0.11-rf)*1.16rf
0.16rf=0.0076
rf=0.0076/0.16
=0.0475
= 4.75%
Therefore, 4.75% will be the risk free rate here.
What is risk free rate?
The risk-free interest rate is the theoretical rate of return on a risk-free investment. As such, it is a benchmark for measuring other investments that include an element of risk. Government bond yields are risk-free interest rates on the most commonly used assets.
To know more about risk free rate, click here- <em>brainly.com/question/13524324</em>
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When you are considering a financial institution you should consider what type of accounts you want to have, how much money you have and if you want to invest. Different financial institutions offer different rates and benefits for their members so it makes sense to figure out your options based on what you want in return.
Answer: aggregate demand; left; lower; lower; higher
Explanation:
If the economy is initially in equilibrium at full employment real GDP (QN), and a stock market crash reduces household wealth and lowers investor confidence, ceteris paribus, the (aggregate demand) curve will shift to the (left) resulting in a (lower) price level (P), (lower) output/real GDP level (Q), and (higher) unemployment level (U).
It should be noted that the crash in the stock market will lead to lesser funds in the economy and lessee funds with households and this will lead to reduction in the demand for goods which will shift the demand curve to the left.
aggregate demand; left; lower; lower; higher
Answer:
b.$39,200
Explanation:
Calculation to determine Paul's allowable itemized deductions for 2020
Using this formula
2020 itemized deductions=State income taxes+Real estate taxes+Gambling losses
Let plug in the formula
2020 itemized deductions=$13,500+$18,900+$6,800
2020 itemized deductions=$39,200
Therefore Paul's allowable itemized deductions for 2020 are $39,200
Answer:
private:
Q = 46
P = 82
social welfare
public
Q = 38.33
P = 38.33
Explanation:
First, we solve for the marignal revenue P = 82
Revenue P x Q = 82Q
Marignal revenue 82
Now, we solve for the socially efficent outcome and the unrestricted market:
marginal cost = 36 + Q
marginal revenue = marignal cost
86 = 36 + Q = 50 social cost
<em><u>socially efficient:</u></em>
Marignal cost 45 + 1.2Q
82 = 45 + 1.2Q
Q = (82-45)/1.2 = 30,83
<em><u>If unrestricted:</u></em>
Marginal cost = 36+ 1.2Q
marginal revenue = 82
Maximization prift:
Q ? 82 = 45 + 1.2 Q = 38.33
P 38.33