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irinina [24]
2 years ago
6

Your opinion is that security C has an expected rate of return of 0.106. It has a beta of 1.1. The risk-free rate is 0.04 and th

e market expected rate of return is 0.10. According to the Capital Asset Pricing Model, this security isA. underpriced. B. overpriced.C. fairly priced.D. Cannot be determined from data provided.
Business
1 answer:
Lostsunrise [7]2 years ago
8 0

Answer:

C. Fairly priced

Explanation: use the equation of calculating Capital Asset Pricing Model CAPM

ER=Rf+βi(ERm−Rf)

where:

ER =expected return of investment = ?

Rf=risk-free rate = 4%

βi=beta of the investment = 1.1

(ERm−Rf)=market risk premium = (10% - 4%)

​

Therefore ER=Rf+βi(ERm−Rf)

= 4% + 1.1(10% - 4%)

=10.6%

therefore, the security is fairly priced

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Tucker's Trucking is considering a project with a discounted payback period just equal to the project's life. The projections in
Vinil7 [7]

Answer:

Break-even quantity= 9520 units

Explanation:

Giving the following information:

The projections include a sales price of $39.

Variable costs per unit of $14.

Fixed costs of $238,000.

The operating cash flow is $24,300.

Break-even quantity= Fixed costs/contribution margin

Break-even quantity= 238000/(39-14)= 9520 units

4 0
2 years ago
While the Securities and Exchange Commission reviews a registration statement for completeness, most issuers can distribute a fr
OlgaM077 [116]

Answer:

True.

Explanation:

The registration statement is a document that private company files with Securities and Exchange Commission (SEC). This document specifies the intent of private companies, that why they desire to share its stocks with the public. It specifies the securities of  registration, investment, etc.

When a company shares it registration statement with SEC and it is in the procedure of checking, the company is free to distribute its free-writing prospectus.

A free-writing prospectus is written communication that states the offer of selling the security. This document specifies the basic details about the issue. When the registration statement in the process of checking, the company is free to distribute free-writing prospectus. Thus the answer is true.

8 0
2 years ago
When managers work on creating conditions and systems to ensure that everything and everyone works together to achieve the organ
SVETLANKA909090 [29]

Answer: Organising

Explanation: Organising in management involves the role a manager plays to ensure that things are working effectively in an organization and that every department in the organization are working at their maximum best. In organising the manager puts everything in place for the smooth running of the organization.

7 0
3 years ago
Sales revenue for a sporting goods store amounted to $528,000 for the current period. All sales are on account and are subject t
weqwewe [10]

Answer:

The answer is A. A debit to Accounts Receivable for $ 586,080

Explanation:

Sales tax is an additional amount of money one pays based on a percentage of the selling price of goods and services that are purchased.

The sales tax amount will be added to sales revenue to form the total bill.

Sales revenue ----------------- $528,00

Sales tax -------------------------- 11%

Sales tax amount

$528,00 x 0.11

= $58,080

Therefore, total bill is:

$528,00 + $58,080

=$586,080.

Debit increases an asset(accounts receivable) while credit decreases an asset(accounts receivable).

Since the accounts receivable will increase, it will be on debit side.

8 0
3 years ago
A market share objective Select one: a. is useful primarily in an industry where total sales are increasing. b. is not recommend
Svetradugi [14.3K]

Answer: d. can be used effectively whether total industry sales are rising or falling

Explanation: One of the vital objectives of every business is to increase its market share. A Market share is given as a percentage of a market accounted for by a specific business entity in terms of total sales or total revenue received. A market share objective thereby defines what a business aims to achieve from its business activities and is consistent with the overall business goals and objectives.  A market share objective can be used effectively whether total industry sales are rising or falling, as pricing decisions made by businesses are taken in a manner that ensures the business achieve or maintaining its targeted market share.

7 0
3 years ago
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