Answer:
b. If Stock A's required return is 11%, then the market risk premium is 5%
Explanation:
Let's analyze each choice with the CAPM formula; r= risk free+beta(mrkt return - risk free)
a.)
Assume market return is 8%
rA= 6% +1 (8% - 6%)= 8%
rB= 6% +2 (8% - 6%)= 10%
Since stock B's return is not twice that of stock A, choice a.) statement is WRONG.
b.)
Formula ; r= risk free+beta(mrkt return - risk free)
Find MRP if rA=11% knowing that MRP = (mrkt rate - risk free)
11% = 6% +1 (11% - 6%)
Therefore MRP= 11%-6% = 5% making choice b. CORRECT
Answer:
<u>C) Briana has a cause of action for racial harassment under Title VII of the Civil Rights Act of 1964, as there is evidence that she was harassed.</u>
<u>Explanation:</u>
It is noteworthy that under the <u>Civil Rights Act of 1964</u> it directly prohibits discrimination in public places. Thus, we could rightly say that Briana's frequent subjection to racial slurs, misbehavior, and threats from her co-workers constitutes "discrimination in public places".
Hence, she has enough evidence to take legal action against Tropical Coast Airlines.
Answer:
understated assets, retained earnings, and net income
Explanation:
As in the given case, the inventory balance at the end of the year does include the $10,000 of inventory plus it also excluded from the physical count
So, if the error is not found, the effect of this error is assets are understated instead of overstated which results the retained earnings and the net income understated
Answer:
Taxable income will be $400,000
Explanation:
As per IRS, the company receiving the dividend from any other comapany will get dividend received reduction (DRD) based on its % of holding. For a company holding less than 20% holding can get 70% deduction from the dividend received.
Income before DRD 400,000
Less DRD (70,000) (100000*70%)
Income after DRD 330,000
However, this DRD is special deduction given after the taxable income. so, taxable income will be $400,000
Answer:
It is likely I sold 500 shares between $40 and $42 per share
Explanation:
Given that:
No of Shares owned = 500 Shares
Current Price per share = $50
Stop limit order price per share = $40
Thus, note that, Stop Limit order is a type of order that specify, the maximum amount at which an individual is willing to buy a stock i.e stop limit buy order or the minimum amount at which individual is willing to sell a stock i.e stop limit sell order.
Therefore, as I have placed a Stop limit sell price at $40, this implies that minimum price for the sale of share is fixed at $40, hence, if the selling price falls to $30, sale will not be executed.
However, Sale will be executed at $40 or more. Therefore, as the share price rose to $42 per share, it is likely I sold my share between $40 and $42
Hence, It is likely i sold 500 shares between $40 and $42 per share