Answer:
In finance, equity is the ownership of assets that may have debts or other liabilities attached to them. Equity is measured for accounting purposes by subtracting liabilities from the value of the assets.
Explanation:
got 100%
Answer:
a. True
Explanation:
from the CAPM formula we can derive the statemeent as true.
risk free = 0.05
market rate = 0.12
premium market = (market rate - risk free) 0.07
beta(non diversifiable risk) = 0
Ke 0.05000
As the beta multiplies the difference between the market rate and risk-free rate a beta of zero will nulify the second part of the equation leaving only the risk-free rate. This means the portfolio is not expose to volatility
Answer: c) economies of scale; increase
Explanation:
When industries are limited by the size of the domestic market, opening trade to the world markets will likely lead to economies of scale and increase real GDP per capita in the domestic country.
When this industry choose to break out of this limitation placed on them due to the small size of market in their country, the idea of opening trade to the world market would lead to reduction in production costs since they now have a larger market (and thus produce more). Also, the real GDP per capita in the domestic country should increase since the company in this domestic nation has expanded its production to the world market.
NOTE:
Economies of scale occur when the cost of production is now reduced because there is an increase in a company's production.
Answer:
Total PV= $2,298.24
Explanation:
<u>First, we need to determine the effective annual rate:</u>
EAR= [1 + (i/n)]^n - 1
EAR= [1 + (0.08/4)]^4 - 1
EAR= 0.082
<u>Now, we can determine the present value of the cash flow, using the following formula:</u>
PV= ∑[Cf/(1+i)^n]
Cf1= 800 / 1.082= 739.37
Cf2= 800 / 1.082^2= 683.34
Cf3= 0
Cf4= 1,200 / 1.082^4= 875.53
Total PV= $2,298.24
