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4 years ago

What is the expected return on this stock given the following information?

Business

1 answer:

Charra [1.4K]4 years ago

4 0

Answer:

The expected return on this stock is:

C. -6.80%.

Explanation:

a) Data and Calculations:

State of the Economy Probability E(R) Weighted Value

Boom 0.40 16% 0.064

Recession 0.60 -22% -0.132

Total expected returns -0.068

= -6.8%

Let us assume that this stock is Stock A. Therefore, Stock A's expected return is given by adding the weighted returns of the two economic states of Boom and Recession. The result shows that the returns will be negative (-6.8%). This implies that instead of appreciating in value, the stock will actually depreciate by 6.8%.

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Determine which phase of the business cycle is associated with each event. a. Unemployment reaches its highest levels, while out

MAVERICK [17]

Answer and Explanation:

The explanation is as follows:

a. In the case when the unemployment reaches to the highest level and the results is in lowest so it would be due to trough

b. In the case when there is a decrease in unemployment and the production would be expand so this is due to an expansion

c. In the case when the economy is in full employment and the output would be generated in full capacity so this is due to peak

d. In the case when the real output is fallen for minimum two quarters so this is due to recession

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3 years ago

A car rental agency uses 96 boxes of staples a year. The boxes cost $4 each. It costs $20 to order staples, and carrying costs a

WARRIOR [948]

Answer:

The correct answer is $55.42.

Explanation:

According to the scenario, the computation of the given data are as follows:

Boxes use = 96 boxes

Cost = $4 per box

Staple cost = $20

Carrying cost = $0.80

So, we can calculate the annual cost of ordering and carrying by using following formula:

Annual cost = (EOQ ÷ 2) × Carrying cost + (Boxes use ÷ EOQ) × Staple cost

Where, EOQ = ( 2 × 96 × 20 ÷ 0.80)^1/2 = 69.28

So, by putting the value, we get

Annual cost = ( 69.28 ÷ 2) × $0.80 + ( 96 ÷ 69.28) × $20

= $27.71 + $27.71

= $55.42

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3 years ago

Which of the following would likely be covered under homeowners insurance but NOT by renter's insurance? Your basement floods, c

belka [17]

I think D is the answer. :)

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3 years ago

A ________ is a collection of tasks, steps, or activities that are performed, usually in a specific order, and result in an end

harina [27]

Answer:

Explanation:

A process is a collection of tasks,steps,or activities that are performed

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2 years ago

A government bond with a coupon rate of 7% makes semiannual coupon payments on January 15 and July 15 of each year. The Wall Str

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Answer:

invoice price (dirty price) = $1,004.13

Explanation:

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clean price = $1,001.25

accrued interest = (Jan. 30 - Jan. 15) x $35 x 1/182 = $2.88

invoice price (dirty price) = clean price + accrued interest = $1,001.25 + $2.88 = $1,004.13

the dirty price or invoice price of a bond includes any accrued interest that the bond may have earned in the period between the last coupon payment and the transaction date.

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3 years ago