How does the divestment of oligopoly firm affect consumer welfare

a. Compute the expected rate of return for Acer common stock, which has a 1.5 beta. The risk-free rate is 4.5 percent and the

ira [324]

Answer:

(a) 12.75%

Explanation:

Given that,

Beta = 1.5

Risk-free rate = 4.5 percent

Expected return on market portfolio = 10 percent

Here, we are using CAPM:

(a) Expected rate of return for Acer common stock:

= Risk free rate + beta (Expected return on market Portfolio - Risk free rate)

= 4.5% + [1.5 (10% - 4.5%)]

= 0.045 + (1.5 × 0.055)

= 0.045 + 0.0825

= 0.1275 or 12.75%

(b) This rate is known as the fair rate which compensates the holder or investor for assuming the risk associated with it and for the time value of money.

8 0

3 years ago

Suppose that a researcher discovers that a measure of the total amount of debt in the U.S. economy over the past twenty years wa

ArbitrLikvidat [17]

Not necessarily. Although the total amount of debt has predicted inflation and the business cycle better than M1 or M2, it may not be a better predictor in the future.

<h3>What is inflation?</h3>

Price increases, or inflation, can be thought of as the gradual loss of purchasing power.
The average price increase of a selection of products and services over time can serve as a proxy for the rate at which buying power declines.
A unit of currency effectively buys less as a result of the increase in pricing, which is sometimes stated as a percentage.
Deflation, which happens when prices fall and buying power rises, can be compared to inflation.
The objective of measuring inflation is to determine the overall effect of changes in price for a variety of goods and services.

Without some theoretical reason for believing that the total amount of debt will continue to predict well in the future, we may not want to define money as the total amount of debt.

Know more about inflation with the help of the given link:

brainly.com/question/15692461

#SPJ4

3 0

1 year ago

Wpq-qhpf-jtf g. i. r.l. s. j. o. i. n. go0gle me et

Vaselesa [24]

Answer:

but why girls?

Explanation:

8 0

3 years ago

The following totals for the month of October were taken from the payroll register of the Tobias Company:

Brums [2.3K]

Answer:

Gross pay = $14,000

Net pay = $8,329

Explanation:

Particular Amount

Salary $14,000

Gross pay $14,000

Less: Federal income tax $3,500

Less: State income tax $1,100

Less: Social security tax $868

$14,000 x 6.20%

Less: Medicare tax $203

$14,000 x 1.45%

Net pay $8,329

7 0

4 years ago

A production department's output for the most recent month consisted of 10,000 units completed and transferred to the next stage

pav-90 [236]

Answer:

15,000 units

Explanation:

Calculation for the equivalent units of production using the weighted average method

Using this formula

Equivalent units of production=

Units completed+Ending work in process inventory

Let plug in the formula

Equivalent units of production=10,000+(10,000×50%)

Equivalent units of production=10,000+5,000

Equivalent units of production=15,000 units

Therefore the equivalent units of production will be 15,000 units

3 0

3 years ago