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Studentka2010 [4]
4 years ago
6

You expect General Motors​ (GM) to have a beta of 1.3 over the next year and the beta of Exxon Mobil​ (XOM) to be 0.9 over the n

ext year.​ Also, you expect the volatility of General Motors to be​ 40% and that of Exxon Mobil to be​ 30% over the next year. Which stock has more systematic​ risk? Which stock has more total​ risk?
Business
1 answer:
Temka [501]4 years ago
8 0

Answer:

As the beta of GM (1.3) is more than that of XOM (0.9), GM has more systematic risk than XOM.

The volatility of GM (40%) is higher than that of XOM (30%). Thus, GM has a higher total risk than XOM.

Explanation:

The systematic risk is the risk caused by factors that affect all of the market and are unavoidable. Such a risk is also known as a market risk and is measured by the beta of a stock. The market beta is always 1. A stock having a beta higher than 1 has higher systematic risk than market and a stock having a lower beta than 1 has a lower systematic risk than the market.

As the beta of GM (1.3) is more than that of XOM (0.9), GM has more systematic risk than XOM.

Total risk, on the other hand, is the risk that comprises of both systematic and unsystematic risk. The systematic risk is the market risk as mentioned above while the unsystematic risk is the firm specific risk and is avoidable. The total risk is measured by the standard deviation or volatility of the stock. The stock with higher volatility has higher total risk and vice versa.

The volatility of GM (40%) is higher than that of XOM (30%). Thus, GM has a higher total risk than XOM.

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Mid City Products Inc. (MCP), developed standard costs for direct material and direct labor. In 2017, MCP estimated the followin
Tasya [4]

Answer:

See below

Explanation:

The below shows the calculation of variance

Budgeted direct labor (per unit) 0.60

Units 2,000

Budgeted direct total labor (hrs) 1,200

Actual hours 1,160

Standard rate $17

Direct labor efficiency variance

The direct labor efficiency variance

= (Budgeted hours - Actual hours) × Standard rate

= (1,200 - 1,160) × $18

= $720 favourable

7 0
3 years ago
A two-year bond with par value $1,000 making annual coupon payments of $100 is priced at $1,000. a. What is the yield to maturit
amm1812

Answer: 10%

Explanation:

When the price of a bond is at par, it means that the coupon rate and the Yield to Maturity are the same.

The Coupon rate is the interest rate that the Issuer of the bond pays the bond holders as a percentage of Par.

The Coupon payment here is $100 and the rate is;

= 100/1,000

= 10%

<em>Coupon Rate = 10% = Yield to Maturity </em>

4 0
3 years ago
When different sequences of operations are required for creating small batches of different products, the type of design or layo
damaskus [11]
Product design but I’m also a little convinced it’s also product layout
3 0
3 years ago
which account option features a note issued by a bank to a depositor for funds placed for a set period? certificate of deposit c
SashulF [63]

An account option which features a note that is issued by a bank to a depositor for funds placed for a set period of time is; A. certificate of deposit.

<h3>What is a certificate of deposit (CD)?</h3>

A certificate of deposit (CD) can be defined as a secured form of time-bound deposit and a special low-risk savings account that is typically issued by a financial institution (bank) to its customers, wherein an amount of money (lump-sum) are left with the bank for a specific period of time, in exchange for an interest rate premium.

This ultimately implies that, a certificate of deposit (CD) pays a higher interest rate to its holder than other regular savings account because banks usually invest this money (lump-sum) in a business, so as to make profit.

Additionally, a bank's certificate of deposit (CD) is protected and insured by the Federal Deposit Insurance Corporation (FDIC) for up to $250,000, so it's somewhat safer than other investment options.

In this context, we can reasonably infer and logically deduce that a savings account option which features a note that is issued by a financial institution (bank) to a depositor for funds that are placed for a set period of time is referred to as a certificate of deposit.

Read more on certificate of deposit here: brainly.com/question/28190396

#SPJ1

6 0
1 year ago
Jessica teaches business studies in a reputed college. As part of the curriculum, she needs to demonstrate to her students the s
nata0808 [166]

Answer:

In the first step jessica should discuss the basic and general ideas of creating business.

Explanation:

As mentioned in the question jessica teaches business studies in a college and she has to demonstrate her students the steps which would be involved in the starting of a business.

So, she has thought to demonstrate the ideas in a sequential order with proper examples and all the steps should be explained nicely.

So,here in the first step she will need to:

Start with the most basic and general idea of creation of  new business.

Here we should know why a business basic idea so important:

  • Because a proper plan will only lead to a business reality.
  • The idea will work as a blueprint in the guidance of business
  • The best idea will progressively lead to well settled company from a start-up.
6 0
3 years ago
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