Answer:
The correct option is A, Portfolios X and Y are in equilibrium
Explanation:
Adopting Miller and Modgiliani Capital Asset Pricing Model formula, the return on both portfolios can be determined:
Expected return=Risk free return+Beta(Market return-Risk free return)
Portfolio X:
Risk free return=8%
Beta=1.0
Expected return=14%
Let market return be MR
14%=8%+1.0(MR-8%)
14%-8%=1.0*(MR-8%)
6%=MR-8%
MR=6%+8%
MR=14%
Portfolio Y:
Risk free return=8%
Beta=0.25
Expected return=9.5%
let market return be MR
9.5%=8%+0.25(MR-8%)
9.5%-8%=0.25MR-2%
1.5%=0.25MR-2%
1.5%+2%=0.25MR
0.25MR=3.5%
MR=3.5%/0.25
MR=14%
Hence both portfolios are at equilibrium since they have the same market return
Answer:
One of the biggest limitations of accounting is that it cannot measure things/events that do not have a monetary value. If a certain factor, no matter how important, cannot be expressed in money it finds no place in accounting.
Answer: Option B
Explanation: The correct answer is raising the minimum wage paid to workers. Standard of living can be defined as the degree of comfort and luxury provided to every individual in a specified area. The standard of living involves every individual in the country thus the investment should be made on the sector which effect every individual. Raising the minimum wage would only increase the standard of living of poor and not every section of the society.
<span>Which markets compete in non-price competition? The companies and brands that compete in non-price competition are brands that are known, name brands with those that are generic. Even though generic brands are known for being cheaper, most brand-name goods sell more products because of their name. </span>
