Answer:
c. 9.21%
Explanation:
In this question, we apply the Capital Asset Pricing Model (CAPM) formula which is shown below
Expected rate of return = Risk-free rate of return + Beta × (Market rate of return - Risk-free rate of return)
For stock A
12% = 4.75% + 1.30 × market risk premium
12% - 4.75% = 1.30 × market risk premium
7.25% = 1.30 × market risk premium
So, the market risk premium = 5.58%
For Stock B, required rate of return would be
= 4.75% + 0.80 × 5.58%
= 4.75% + 4.464%
= 9.214%
Answer:
b). one agent secures benefits that others pay for.
Explanation:
The free-rider problem is described as the problem when some individuals consume or take the benefit of a resource without paying for it. in this problem, one agent is being benefitted from the resources that the others are paying for. This creates a load on a shared resource and eventually causes market failure. In order to cope with this problem, the organizations must ensure a fair distribution of resources and their benefits as per the payment made by the agents. Therefore, option B is the correct answer.
Answer:
guiding function of prices in a market system
Explanation:
The price transfer information cross the agent which, organize around them, the price of a good made it more profitable than other, which generate more people diving into the business. This in the end lower the price as there are more competition, and causes agent to leave the market and move to another thus, allocating resources without explicit regulatory structure or goverment actions. Same concepts occur with the consumer, if the price of a good is lower, they will prefer to purchase it over other with are more expensive. This will send the signal to produced to generate more units of this goods and decrease the output of goods which are not consumed as much.
Answer:
The tax on Kaitlyn's capital gain was $100
Explanation:
In order to calculate the tax on Kaitlyn's capital gain we would have to calculate first the Nominal capital gain as follows:
nominal capital gain=$400 - $200
nominal capital gain= $200
Therefore, tax on Kaitlyn's capital gain= tax percentage×nominal capital gain
=50%×$200
=$100
The tax on Kaitlyn's capital gain was $100
Answer:
B. Economic classes
Explanation: its correct on eadg
