Answer:
A) rational self-interest because he is attempting to increase his own income by identifying and satisfying someone else's wants.
Explanation:
One of economics basic premises is that human beings are rational and act on self interest. That describes both the behavior of consumers who will always try to maximize their benefits at the lowest possible cost, and entrepreneurs like Alex who will try to increase their wealth by identifying and satisfying other people's needs and wants.
The expected return will be given by:
E(R)=Total sum of the expected return
E(R)=-0.1*0.3+0.1*0.4+0.3*0.3
E(R)=-0.03+0.04+0.09
E(R)=0.1=10%
We therefore conclude that the expected return is 10%
Answer:
$1,747
Explanation:
Given:
Generate Cash flows = $20,000 per year
Salvage value = $10,000
Interest = 10% = 0.10
Computation:
Net present value = PV of cash inflows - PV of cash outflow
= [($20,000 X 6.1446) + ($10,000 X 0.3855)] - $125,000
= [$122,892 + 3855] - $125,000
= $1,747
PV factor (for salvage value)
Inflow PV factor = 6.1446
I think it is Human Resources
Explanation - you are in food business. You are meeting with team members to decide what her or not o participate
Answer:
D. The actual expected stock return indicates the stock is currently overpriced.
Explanation:
The actual rate of return of this stock = 13.33%
Rate of return using CAPM:
r = risk free rate + beta(Market return- risk free rate)
risk free = 3.3% or 0.033 as a decimal
beta = 1.18
market return = 12.20% or 0.1220 as a decimal
r = 0.033 + 1.18(0.1220 - 0.033)
= 0.033 + 0.10502
= 0.1380 or 13.80%
Since rate of return and price of a stock have inverse relationship, the actual rate of return is lower meaning that the stock is currently overpriced.
