1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
ivolga24 [154]
3 years ago
15

Consider the multifactor APT with two factors. Portfolio A has a beta of .5 on factor 1 and a beta of 1.25 on factor 2. The risk

premiums on the factor 1 and 2 portfolios are 1% and 7%, respectively. The risk-free rate of return is 7%. The expected return on portfolio A is _ if no arbitrage opportunities exist.
a.13.5%
b.16.25%
c.23%
d.15%
Business
1 answer:
Dovator [93]3 years ago
7 0

Answer:

(B) 16.25%

Explanation:

Using the multifactor APT,

E(R_{A} ) = R_{f} + \beta_{1}.RP_{1} + \beta_{2}.RP_{2}

where E(R_{A} ) = expected return on portfolio A,

R_{f} = the risk free rate of return,

\beta_{i} = beta on factor "i"

RP_{i} =  risk premium on factor "i".

Therefore,

return on portfolio A = 7% + (0.5 * 1%) + (1.25 * 7%)

= 0.07 + (0.5 * 0.01) + (1.25 * 0.07)

= 0.07 + 0.005 + 0.0875

= 0.1625

= 16.25%.

You might be interested in
Ultimately ________ create and market products that meet the needs of customers
timofeeve [1]
The producers create and market products to consumers, so the answer is producers
7 0
4 years ago
The Carlberg Company has two manufacturing departments, assembly and painting. The assembly department started 12,400 units duri
Anna007 [38]

Answer

The answer and procedures of the exercise are attached in the following archives.

Step-by-step explanation:

You will find the procedures, formulas or necessary explanations in the archive attached below. If you have any question ask and I will aclare your doubts kindly.  

Download xlsx
6 0
3 years ago
Please help! <br><br>How can easy access to credit lead to Financial Mistakes and Bankruptcy?
zvonat [6]

Answer: over-borrowing.

Explanation:

credit cards function like this: you can "buy" a lot of things with it, including very very expensive things. this is because instead of really buying that product, you borrow money from the bank to buy it. you then have to pay it off in slower amounts of money over time until youve paid off the original cost of the product and more because the bank will most likely charge interest.

sounds great, right?

it is, until you cant afford to pay those smaller amounts of money. then, it starts to build up and if you still cant afford to pay the bank, they will begin to liquidize your physical assets (they take your stuff as payment, really anything, even your house can be taken.)

3 0
3 years ago
The ability to perform more than one complex encoding tasks simultaneously demonstrates the importance of
lys-0071 [83]
The ability to perform more than one complex encoding tasks simultaneously demonstrates the importance of automatic processing. Automatic processing does not require attention to be paid and deliberately to be put in effort. Something that is done <span>without giving it any thought is automatic processing. </span>
7 0
3 years ago
Read 2 more answers
Give me top 10 American snacks
agasfer [191]

Answer:

1 - Reese’s Peanut Butter Cups

Best snacks Reeses peanut butter cups

This snack is number one for a reason. It combines the best of both worlds with its milk chocolate outer layer and rich, and thick peanut buttery center. Did you know there have been 21 limited edition flavors of Reese’s, including Fudge, Hazelnut Cream and White chocolate?

2 - Milky Way

Best snacks milkyway

Milky Way is one of the best snacks you can have because it’s full of the delicious taste of caramel and chocolate. Take a look at the original packaging above: Boy, how times have changed!

Here are a few interesting facts about the candy bar company that you might not have known.

3 - Butterfinger

The Bart Simpson-endorsed treat is one classic you’re not soon to forget. It’s has a flakey texture that melts in your mouth.

4 - 100 Grand

Unarguably one of the best snacks of all time, Nestle’s 100 Grand is a complex bar layered everywhere with taste. From its crunchy outer coating of rice to its carmel middle.

“That’s rich!” couldn’t be a more perfect slogan.

If you want to know more about how the company got started, Collecting Candy compiled a list of news clippings and packaging throughout the brand’s history.

5 - Whatchamacallit

With its “can’t put my finger on it” taste, Whatchamacallit is probably one of the most creative named candy bars of all time. It’s delicious flavor combines caramel, peanut butter and chocolate, and, over the years, has even found itself as the main attraction of homemade treats, such as pies, cheesecakes, and unique takes on the candy bar itself.

6 - Twix

Twix is another great candy bar that’s gone through several changes throughout the years. From the original caramel cookie bar to Twix White, Twix Dark and Twix Peanut Butter, its unexpected twist of smooth and crunchy flavors are sure to please all year round.

Did you know the word “Twix” is a portmanteau (a fancy word meaning a combination of two or more words) of “Twin” and “Sticks”.

7 - 3 Musketeers

One of the best treats to get during the Halloween season, 3 Musketeers are known for their ooey goey core of whipped nougat that never seems to end.

8 - PayDay

First on the market in 1932, the peanut encrusted bar with the caramel center was a favorite of well known individuals, such as the late comedian Bob Hope.

9 - BabyRuth

Next is the candy bar that was named after President Grover Cleveland’s daughter (As not Babe Ruth as we’ve all thought for ages now).

The signature flavors here are caramel and milk chocolate.

10 - Take 5

best snacks take 5

Take 5 is a candy bar released by The Hershey Company as early as 2004. It’s known for its layers of pretzels, milk chocolate, peanut butter, milk chocolate, caramel & peanut.

3 0
2 years ago
Other questions:
  • Chocolate Supreme purchased new baking equipment for $15,000 subject to terms 4/10, n/45. The discount was taken. Additional cos
    13·1 answer
  • What to do if you lose your planet fitness card?
    6·1 answer
  • Liabilities are a. any accounts having credit balances after closing entries are made. b. deferred credits that are recognized a
    14·1 answer
  • The American Civil Liberties Union was heavily funded by the Republican Party and Wall Street businessmen in the hopes of promot
    10·1 answer
  • How valuable a low-cost leader's cost advantage is depends on A) the aggressiveness with which the low-cost leader pursues conve
    9·1 answer
  • On December 1, 2020, Concord Corporation acquired new equipment in exchange for old equipment that it had acquired in 2017. The
    6·1 answer
  • A company that lacks a competitively powerful stand-alone resource Multiple choice question. will be unable to develop competenc
    12·1 answer
  • Costs such as security deposit,inspections, attorney or broker fees are examples of blank
    9·2 answers
  • Which step in the decision-making process would help you in deciding how much money you want to make at work?.
    11·1 answer
  • Many businesses borrow money during periods of increased business activity to finance inventory and accounts receivable. Neiman
    9·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!