Answer Choices:
A. is staffed by accountants, economists, tax lawyers
B. keeps Congress well informed on international affairs
C. was created by Article III of the Constitution
D. consents to treaties and trade agreements negotiated by the President
Answer:
A.
Answer:
The correct statement is: "The fixed cost per unit will decrease when volume increases."
Explanation:
Total fixed costs remain the same within a relevant range, but the <em>fixed cost per unit</em> decreases as production increases, because the same fixed costs are spread over more units produced.
Answer: 0.9
Explanation:
The Expected Return on an investment can be calculated using the Dividend Discount Model as it is a key component in thw formula which is,
P = D1 / r - g
where,
D1 is the dividend paid next year
P is the current stock price
g is the growth rate
r is the expected return
With the given figures we have,
84 = 4.20 / r - 0.08
84 ( r - 0.08) = 4.20
r - 0.08 = 4.20/84
r = 4.20/84 + 0.08
r = 0.13
The Expected Return can be slotted into the CAPM formula to find the beta.
The CAPM formula calculates the Expected Return in the following manner,
Er = Rf + b( Rm - rF)
Where,
Er is expected return
Rf is the risk free rate
Rm is the market return
b is beta
Slotting in the figures gives,
0.13 = 0.04 + b( 0.14 - 0.04)
0.13 = 0.04 + b (0.1)
0.13 - 0.04 = 0.1b
b = 0.09/0.1
b = 0.9
Using the constant-growth DDM and the CAPM, the beta of the stock is 0.9
