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Mumz [18]
4 years ago
13

Nagel Equipment has a beta of 0.88 and an expected dividend growth rate of 4.00% per year. The T-bill rate is 4.00%, and the T-b

ond rate is 5.25%. The annual return on the stock market during the past 4 years was 10.25%. Investors expect the average annual future return on the market to be 12.50%. Using the SML, what is the firm's required rate of return?13.83% 13.55% 11.62% 11.76% 14.94%
Business
1 answer:
Natalka [10]4 years ago
7 0

Answer:

11.62%

Explanation:

In this question, we apply the Capital Asset Pricing Model (CAPM) formula which is shown below

Expected rate of return = Risk-free rate of return of treasury bond + Beta × (Market rate of return - Risk-free rate of return)

= 5.25% + 0.88 × (12.50% - 5.25%)

= 5.25% + 0.88 × 7.25%

= 5.25% + 6.38%

= 11.63% approx

All other information which is given is not relevant. Hence, ignored it

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Answer:

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Explanation:

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3 years ago
The purpose of __________ is to summarize and explain a specific set of data
GarryVolchara [31]
Hello!

The correct answer for the blank is: Descriptive Statistics.

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6 0
3 years ago
Read 2 more answers
On June 1, Skysong, Inc. issues 2,700 shares of no-par common stock at a cash price of $6 per share. Journalize the issuance of
faust18 [17]

Answer:

June 1

DR Cash <u>$16,200</u>

CR Common Stock <u>$16,200</u>

<em>(To record issuance of Common Stock)</em>

<u>Workings</u>

Cash

= 2,700 shares * $6 price

= $16,200

8 0
3 years ago
Caitlin, Chris, and Molly are partners and share income and losses in a 3:4:3 ratio. The partnership’s capital balances are Cait
Nana76 [90]

Answer:

$94,080

Explanation:

Data provided in the question:

The partnership’s capital balances

Caitlin=  $128,000

Chris = $88,000

Molly = $108,000

Paul's equity = 20%

Amount invested by the Paul = $68,000

Now,

The total value of the capital = ∑ ( capital balances of each partner )

= $128,000 + $88,000 + $108,000 + $68,000

= $392,000

Therefore,

The balance in Paul's capital account immediately after Paul’s admission

= 20% of $392,000

= $78,400

Thus,

Balance in capital account for Caitlin, Chris, and Molly

= total value of the capital  - Balance in Paul's capital

= $392,000 - $78,400

= $313,600

also,

Share of Caitlin = \frac{3}{3+4+3} = 0.3

hence,

balance in Caitlin’s capital account immediately after Paul’s admission

= 0.3 × $313,600

= $94,080

4 0
3 years ago
Creating Your Budget
snow_lady [41]

Answer: PDF wont work for me.

Explanation:

5 0
2 years ago
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