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Dvinal [7]
3 years ago
12

Consider the following information: Rate of Return If State Occurs State of Probability of Economy State of Economy Stock A Stoc

k B Stock C Boom .15 .31 .41 .21 Good .60 .16 .12 .10 Poor .20 −.03 −.06 −.04 Bust .05 −.11 −.16 −.08 a. Your portfolio is invested 30 percent each in A and C, and 40 percent in B. What is the expected return of the portfolio? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) b-1. What is the variance of this portfolio? (Do not round intermediate calculations and round your answer to 5 decimal places, e.g., .16161.) b-2. What is the standard deviation? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
Business
1 answer:
larisa [96]3 years ago
3 0

Answer:

Bob Marley, Elvis Presley, Michael Jackson

Explanation:

you have to kill one, marry one, jump one

You might be interested in
Mia Breen Corp. produces and sells wind-energy-driven engines. To finance its operations, Mia Breen issued $996,000 of 15-year,
ziro4ka [17]

Answer:

Mia Breen Corp.

Journal Entries:

May 1: Debit 110 Cash $996,000

Credit 251 9% Callable Bonds Payable $996,000

To record the issuance of the 9% callable bonds for 15 years.

Nov. 1: Debit 710 Interest Expense $4,820

Credit 110 Cash $44,820

To record the payment of interest.

Year 5:

Nov. 1: Debit 251 9% Callable Bonds Payable $996,000

Credit Cash $986,040

Credit 711 Loss on Redemption of Bonds $9,960

To record the redemption of the bonds at 99 and the accruing gain.

Explanation:

a) Data and Calculations:

Face value of 9% callable bonds issued = $996,000

Price of the bonds = $996,000

Coupon interest rate = 9%

Maturity period = 15 years

Payment terms = semiannual on May 1 and November 1

Year 1:

May 1:

Cash payment = $44,820 ($996,000 * 4.5%)

Interest expense = $44,820

Analysis:

May 1: 110 Cash $996,000 251 9% Callable Bonds Payable $996,000

Nov. 1 710 Interest Expense $4,820 110 Cash $44,820

Year 5:

Nov. 1: 251 9% Callable Bonds Payable $996,000 Cash $986,040 711 Loss on Redemption of Bonds $9,960

3 0
3 years ago
An investor borrows an amount at an annual effective interest rate of 5% and will repay all interest and principal in a lump sum
Artist 52 [7]

Answer:

$74.14

Explanation:

first we must calculate the market price of the bond:

0.03 = {40 + [(1,000 - MV)/20]} / [(1,000 + MV)/2]

0.03 x [(1,000 + MV)/2] = 40 + [(1,000 - MV)/20]

0.03 x (500 + 0.5MV) = 40 + 50 - 0.05MV

15 + 0.015MV = 90 - 0.05MV

0.065MV = 75

MV = 75 / 0.065 = $1,153.85

so the customer borrowed $1,153.85

in 10 years, the principal + interest will = $1,153.85 x (1 + 5%)¹⁰ = $1,879.50

the customer will receive:

20 semiannual payments of $40, the future value = $40 x 22.841 (FV annuity factor, 2%, 19 periods) + $40 = $953.64

bond's face value = $1,000

total money received = $1,000 + $953.64 = $1,953.64

net gains = $1,953.64 - $1,879.50 = $74.14

3 0
4 years ago
One problem in the interstate trucking industry is the number of trucks that return after making a delivery with an empty truck.
Leno4ka [110]

Answer:

Yield management pricing.

Explanation:

One problem in the interstate trucking industry is the number of trucks that return after making a delivery with an empty truck. However, there is a website where independent interstate truckers can look for loads that they can carry with them on their return trip. Because the trucks would be returning empty (and inefficiently), truckers who use this website to get business that they would not have had without it and charge a reduced shipping rate. This reduced rate is an example of yield management pricing.

Yield management pricing can be defined as a pricing strategy which typically involves having a variety of charges (prices) for the services being provided by an organization at a specific period of time.

Simply stated, it basically involves providing a service at the right price, time and to the right service taker.

The yield management pricing strategy is mostly used by the airline, hotel, travel businesses. The main purpose of the yield management pricing is to maximize profits or generate more revenue.

3 0
3 years ago
Rogoff Co.'s 15-year bonds have an annual coupon rate of 9.5%. Each bond has face value of $1,000 and makes semiannual interest
meriva

Answer:

maximum sum of $891.00

Explanation:

given data    

Face Value = $1,000

Annual Coupon Rate = 9.50%

Time to Maturity = 15 years

yield to maturity = 11%

to find out

maximum price you should be willing to pay for the bond

solution

we know that Semiannual Coupon Rate will be  = 4.75%  

so semiannual Coupon will be = Semiannual Coupon Rate ×  Face Value

semiannual Coupon = 4.75% × $1,000

Semiannual Coupon = $47.50

and Semiannual Period will be for 15 year  = 30

and Semiannual yield to maturity will be here YTM = 5.50%

so

Current Price  will be here

Current Price = Semiannual Coupon × \frac{1-(\frac{1}{1+r})^t}{r} + \frac{faevalue}{(1+r)^t}     ...................1

put here value

Current Price = $47.50 × \frac{1-(\frac{1}{1.055})^{30}}{0.055} + \frac{}{1.055^{30}}

Current Price = $891.00

so pay a maximum sum of $891.00

6 0
3 years ago
Which of the following statements is CORRECT?a. An investment that has a nominal rate of 6% with semiannual payments will have a
andreyandreev [35.5K]

Answer:

c. If a loan has a nominal annual rate of 7%, then the effective rate will never be less than 7%

<em>CORRECT</em>

as at least is recive 7% of the investment. If payment are made in shorter period (semiannually, quarterly, etc)

Then the effective rate will be higher, not lower.

Explanation:

a. An investment that has a nominal rate of 6% with semiannual payments will have an effective rate that is smaller than 6%

FALSE the effective rate will be higher as there is compounding effect.

b. The present value of a 3-year, $150 ordinary annuity will exceed the present value of a 3-year, $150 annuity due

FALSE the annuity-due is discounted for one period less, as the payment are made at the beginning of the period therefore; his V is greater.

d. If a loan or investment has annual payments, then the effective, periodic, and nominal rates of interest will all be different

FALSE if it mades annual payments they will be equal

e. The proportion of the payment that goes toward interest on a fully amortized loan increases over time.

FALSE the interest will decrease over time as there is a portion of principal which is being paid each installment

3 0
3 years ago
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