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SVETLANKA909090 [29]
3 years ago
9

Consider a risky portfolio. The end-of-year cash flow derived from the portfolio will be either $70,000 or $200,000 with equal p

robabilities of .5. The alternative risk-free investment in T-bills pays 6% per year.
a. If you require a risk premium of 8%, how much will you be willing to pay for the portfolio? (Round your answer to the nearest whole dollar amount. Omit the "$" sign in your response.)

Price________$

b.Suppose that the portfolio can be purchased for the amount you found in (a). What will be the expected rate of return on the portfolio? (Round your answer to the nearest whole number. Omit the "%" sign in your response.)

Rate of return______%

c.Now suppose that you require a risk premium of 12%. What is the price that you will be willing to pay? (Round your answer to the nearest whole dollar amount. Omit the "$" sign in your response.)

Price_______$
Business
1 answer:
xenn [34]3 years ago
4 0

Answer:

A) 964,286

B) 14

C) 750,000

Explanation:

The portfolios expected return = (0.5 x $70,000) + (0.5 x $200,000) = $35,000 + $100,000 = $135,000

If the risk free investment yields 6% per year, and you require a risk premium of 8%, then the total interest rate that the portfolio yields must be 6% + 8% = 14%

you will be willing to pay: $135,000 / 14% = $964,286 for the portfolio

if the risk premium increase by 4%, then the price of the portfolio will decrease to: $135,000 / 18% = $750,000

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Corporate strategy for a diversified or multi-business enterprise chiefly concerns the development of a strategic vision a set o
harkovskaia [24]

Answer:

Corporate Strategy

Corporate strategy for a diversified or multi-business enterprise:

"concerns strategy initiatives to establish business positions in different industries, whether to hold or divest from existing businesses, strategic actions to boost the combined performance of the set of businesses the company has diversified into, and how to capture cross-business synergies, and then turn them into a competitive advantage."

Explanation:

Corporate strategy is concerned with market growth, stability, and organizational renewal.  The purpose of corporate strategy is to achieve greater profitability, higher market share, and sustainable growth in revenue through product and market diversification. A corporate organization, in trying to grow, engages in business restructuring, establishing strategic partnerships, and achieving organizational excellence.  These activities emanate from corporate strategic planning.

6 0
3 years ago
Current information for the Healey Company follows: Beginning raw materials inventory $ 29,200 Raw material purchases 74,000 End
Rzqust [24]

Answer:

cost of goods manufactured= $167,800

Explanation:

To calculate the cost of goods manufactured, we need to use the following formula:

cost of goods manufactured= beginning WIP + direct materials + direct labor + allocated manufacturing overhead - Ending WIP

First, we need to determine the direct material used in production:

Direct material used= beginning inventory + purchases - ending inventory

Direct material used= 29,200 + 74,000 - 30,600= 72,600

cost of goods manufactured= 36,400 + 72,600 + 56,800 + 44,000 - 42,000

cost of goods manufactured= $167,800

3 0
3 years ago
A market economy cannot produce a socially desirable outcome because individuals are motivated by their own selfish interests.
adoni [48]
B it false
we should all know that
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____________ is best defined as a statistical procedure, which involves quantitatively pooling the data from a group of independ
Ludmilka [50]
The meta-analysis is the best represent as a statistical action, that which involves quantitatively pooling the data from a group of independent studies that have studied the same or similar clinical problems, by using the same or similar research methods.
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3 years ago
A company that loans money to an organization is a(n):______.a. supplier.b. lender.c. shareholder.d. investor.
fomenos

Answer:

lender.

Explanation:

A lender is an individual or company that makes funds available another com[any. Lenders receive fixed payments based on a predetermined rate at an agreed time.

A shareholder is the owner of a company. A shareholder is a person who buys the stock of a publicly traded company

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6 0
3 years ago
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