Answer:
Find below complete question:
There are three equally large divisions in a conglomerate: (i) food division, (ii) travel division, and (iii) construction division. Their divisional betas are 0.5, 1.8, and 2.2, respectively.
What is the overall beta for the entire firm?
A.0.5
B.1.8
C.1.5
D.2.2
Correct option is C,1.5
Suppose that you are evaluating a project in the food division. What is the appropriate discount rate for this project? Assume that the CAPM holds. The risk-free rate is 1% and the expected return on the market is 7%.
A.10%
B.11.8%
C.4%
D.14.2%
Correct option is A,10%
Explanation:
The starting point is to determine the overall beta for the company.
Since all the three divisions are equally large,it means they share the same probability weighting of 0.3333(1/3)
food division 0.3333 *0.5
Travel division 0.3333*1.8
construction 0.3333*2.2
overall beta 1.49985
1.5 approx
Ke=Rf+beta(Rm-Rf)
Rf is the risk free rate of 1%
Rm is the expected return on market of 7%
beta is 1.5
Ke=1%+1.5*(7%-1%)
Ke=10%
Answer:
monopoly firms will operate at a loss because P =MC.
Explanation:
In the case when the government needed to regulate the natural monopoly to price at the marginal cost so here the firm i.e. monopoly would operate at the loss because the price is equivalent to the marginal cost
i.e.
P = MC
Therefore as per the given situation the option d is correct
The answer would be D, a conflict of interest would be when someone is personally benefitting by taking advantage of their position or job. hope this helps!
Answer:
Focused differentiation.
Explanation:
This strategy usually focuses on narrow segments which tends to achieve either an advantageous cost or differentiation.
Differentiation is also said to involves making your products or services different from and more attractive than those of your competitors. How you do this depends on the exact nature of your industry and of the products and services themselves, but will typically involve features, functionality, durability, support, and also brand image that your customers value.
