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goblinko [34]
3 years ago
7

Kollo Enterprises has a beta of 0.70, the real risk-free rate is 2.00%, investors expect a 3.00% future inflation rate, and the

market risk premium is 4.70%. What is Kollo's required rate of return?
Business
1 answer:
sdas [7]3 years ago
3 0

Answer:

5.29%

Explanation:

Capital asset pricing model measure the expected return on an asset or investment. it is used to make decision for addition of specific investment in a well diversified portfolio.

Formula for CAPM

Required rate of return = Risk free rate + beta ( market risk premium )

As per given data:

Beta = 0.70

Risk free rate = 2.00%

Market risk premium = 4.70%

Required rate of return = 2% + 0.7 ( 4.7% )

Required rate of return = 2% + 3.29%

Required rate of return = 5.29%

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Some companies positively harness the power of rumors to multiple choice instill false confidence in investors. replace formal c
zubka84 [21]

Some companies positively harness the power of rumors to create buzz about a new product launch. Option C. This is further explained below.

<h3>What are rumors?</h3>

Generally, rumor is simply defined as a tale or report that is now doing the rounds but whose veracity is questionable.

In conclusion,  In certain cases, corporations use the power of rumors to promote a new product introduction.

Read more about rumors

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7 0
2 years ago
Which of the following is not a financial intermediary?
EastWind [94]

Answer:

Commercial business.

Explanation:

An institution that facilitates the channeling of funds between lenders and borrowers indirectly. And this all are the examples of the same.

Banks.

Mutual savings banks.

Savings banks.

Building societies.

Credit unions.

Financial advisers or brokers.

Insurance companies.

Collective investment schemes.

cooperative societies

Stock exchanges

Commercial business is not a financial intermediary, but this includes the distribution of goods & services and this include all the asset and liabilities of the business and doesn't take into account the operations.

4 0
3 years ago
Categories of expenditures Gilberto and Juanita Jones live in Swarthmore, PA. Juanita's father, Lorenzo, lives in Sweden. For ea
kotegsom [21]

Answer:

a. Imports

b.Exports or Consumption

c. Consumption

d. Government Spending

e. Consumption.

Explanation:

a. if Gilberto buys Italian wine in the US that is part of consumption spending because the store that Gilberto buys from already imported the wine from Italy and paid all the costs that go with it but if Gilberto orders the wine from Italy that will be part of imports because the wine will have to be imported then have all those importing costs on it.

b. Juanitas father will be exporting the syrup if its from the US even though he might buy it online as he lives in Sweden .

c. Juanita will be part of consumption spending for goods and services as this will be part of the US GDP consumption spending.

d. This is part of government purchases as the government will spend on everything that includes repaving the high way.

e. Consumption spending because they are manufactured in the US and they are in the US therefore its part of the US purchases of goods and services.

8 0
3 years ago
which of the following best completes the diagram? a. major credit card networks b. companies that handle the worldwide processi
Ratling [72]

major credit card and networks

6 0
3 years ago
Wally, Inc. issued 500 shares of $10 par preferred stock at $83 a share. Each share had a warrant attached that allowed the hold
Mars2501 [29]

Answer: credit to Additional Paid -in Capital on Preferred Stock for $28,200

Explanation:

The journal entry will be:

Debit: Cash = $500 × 83 = $41500

Credit: Preferred stock = $5000

Credit: Additional paid in capital on preferred stock = $28200

Credit: Paid in capital - Common stock warrants = $8300

Note that Additional paid in capital on preferred stock was calculated as:

Amount allocated to preferred stock = (64/64+16) × 41500 = 33200

Less: Preferred stock face value = $500 × $10 = $5000

Additional paid in capital on preferred stock = $28200

7 0
3 years ago
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