Answer:
The portfolio with a beta of 1.38 should earn the most risk premium based on CAPM.
The correct answer is B
Explanation:
A diversified portfolio with returns similar to the overall market will not earn the most risk premium because its beta is equal to 1.
A stock with a beta of 1.38 produces the most risk premium because any stock with the highest beta gives the highest risk-premium. This is the correct answer.
A stock with a beta of 0.74 does not provide the highest risk premium.
Us treasury bill does not provide any risk premium since it is the risk-free rate.
A portfolio with a beta of 1.01 does not produce the highest risk premium.
Answer:
Grandmother should purchase 2 units of both products
Explanation:
Let's denote
MU = Marginal utility
P = Price
Q = Quantity
The Utility will be maximum when both unit's MU/P is equal
Product A
Q MU P MU/P
1 80 $5 16
2 40 $5 8
3 30 $5 6
4 15 $5 3
5 7 $5 1.4
6 6 $5 1.2
7 5 $5 1
8 3 $5 0.6
Product B
Q MU P MU/P
1 30 $2 15
2 16 $2 8
3 15 $2 7.5
4 14 $2 7
5 13 $2 6.5
6 12 $2 6
7 11 $2 5.5
8 10 $2 5
As you can see above MU/P is same when grandma purchase 2 product each to maximize utility.
Answer:
The transaction allows a seller to take pride in its product
Explanation:
Have a good one!
The static-budget variance for operating income for Jerome Mobility Inc for 2017 is $7,500 F
Solution & Explanation:
Static difference in net profits
= Actual result - Static budget amount
= $47,500 - $40,000
= $7,500 F
The static budget is related to the amount of development expected at the beginning of the financial year. The master budget is the static budget, since it is around a single (absolute) projected production level which is established for the time.
F implies the real expense is smaller than the estimated costs for product products.
The single-budget distinction is the difference in the single budget between the real effects and the resulting estimate.
An adverse deviation -denoted U— has the impact of decreasing operational profit relative to the expected sum as interpreted separately. For certain countries, including the UK, negative variances are often referred to as adverse variances.
To conduct a systematic random sampling out of the population, one should follow the following steps:
1. Create a list and assign numbers on every element in the population
- Say a we assign cases 1 to 12,000
2. Decide the sample desired sample size
- In our case, the sample size required is 600 cases
3. Select sampling interval
- Simply divide the population with the sample size
- 12,000/600 =20
- Therefore, our sampling interval is 20. Meaning on every 20th element on the population we get to draw our pick until the desired sample size is accomplished.