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Genrish500 [490]
4 years ago
10

Suppose the common stock of United Industries has a beta of 1.28 and an expected return of 15.47 percent. The risk-free rate of

return is 3.7 percent while the inflation rate is 4.2 percent. What is the expected market risk premium
Business
1 answer:
Dima020 [189]4 years ago
3 0

Answer:

The expected market risk premium is 9.20%

Explanation:

In order to calculate the expected market risk premium we would have to calculate the following formula:

expected market risk premium=(Rs-Rf)/β

Rf=3.7%

β=1.28

Rs=15.47%

expected market risk premium=(15.47%-3.7%)/1.28

expected market risk premium=9.20%

The expected market risk premium is 9.20%

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A completely new business solution to solve marine pollution (which is caused by climate change is the production of a new organic material that can be used to clean marine bodies.

<h3>How will this organic material look like?</h3>

Chemicals and debris, the majority of which originates on land and is dumped or blown into the water, make up marine pollution. This pollution harms the ecosystem, the health of all living things, and global economic institutions.

Therefore, the organic material will be a combination of:

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  • Coconut, etc.

Note that by working on the materials above, one can create an organic material that when scattered or place on top of water bodies, it will make all the pollutant to float upward and then they can be taken out of the water and also it can be taken by man as food as it is organic and would not be harmful to the body.

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8 0
1 year ago
A firm in the market for designer jeans has some degree of monopoly power. The demand curve it faces has a price elasticity of d
natali 33 [55]

A rule of thumb is used to determine if the monthly rent earned from a piece of investment property will exceed that property's monthly mortgage payment.

Using the rule of thumb pricing the profit-maximizing price of a monopoly firm is = P = MC/1+(1/Ed)

Ed is the elasticity of demand for a firm, not the market. So,

Ed = -3.P = $50/1+ (1/(-3)) = $50/(1-1/3)p = 50/(2/3 ) = $75 dollar.

Monopoly power (also known as market power) refers to the ability of a company to charge a price higher than its marginal cost. Monopoly power usually exists when demand is less elastic and barriers to entry are large.

There are three main sources of monopoly power: (1) price elasticity of demand (Ed), (2) number of companies in the market, and (3) interaction between companies. The price elasticity of demand is the most important determinant of market power for price rules: L = (P – MC) / P = -1 / Ed.

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8 0
2 years ago
According to _____________, as an entity separate and distinct from its owners, the corporation acts under its own name rather t
mario62 [17]

Answer:

According to _____________, as an entity separate and distinct from its owners, the corporation acts under its own name rather than in the name of its stockholders.

C) Separate legal existence

Explanation:

This separate legal existence means that before the law, a corporation is a distinct person, just like every other person, with rights and obligations.  It can enter into binding contracts.  It can perform business activities within the ambits of the law.  It has its own name and personality that is not intertwined with those of the owners or stockholders.  It enjoys a continuous lifespan that can only be liquidated under the laws.

3 0
3 years ago
Jane purchased a piece of equipment for $250,000 for use in her business. She incurred freight charges of $3,500, installation c
Ne4ueva [31]

Answer: $36,000 loss

Explanation:

Purchase cost = $250,000

Freight charges = $3500

Installation charges = $2500

Maintenance cost = $5000

Depreciation = $25000

Offered price = $200,000

Total cost incurred = $(250,000 + 3500 + 2500 + 5000)

Total cost incurred = $261,000

Depreciation = $25,000

Book value of equipment = $261,000 - $25,000 = $236,000

Gain/loss = Book value - offered price

Gain/Los = $236,000 - $200,000

$36,000 loss

4 0
4 years ago
70 Marketing Dynamics .. .. : : . . : Part 4: Be Your Own Leader Leaders on a Top Secret Mission On December 6, 2011, a woman wa
egoroff_w [7]
Not trying to be rude but that’s too much for too little amount of points
That’s technically an entire book page of reading
4 0
3 years ago
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