Answer:
$118,421
Explanation:
first we must calculate the expected value of the risky portfolio = ($70,000 x 0.5) + ($200,000 x 0.5) = $135,000
since your risk premium is 8% and the risk free rate is 6%m then you should discount the expected value by 8% + 6% = 14% to determine its current market price
= $135,000 / (1 + 14%) = $118,421
Answer:
True
Explanation:
The internal rate of return is a measurement utilised in capital planning to appraise the productivity of potential investment. The internal rate of return is a markdown rate that makes the net present worth of all incomes from a specific task equivalent to zero. If the NPV is zero the project is not feasible and if the NPV is zero or positive the investor should invest in that particular project
Answer:
A. average total cost is rising.
Explanation:
Whenever marginal cost is more than average cost it means it costs more to produce a unit now compared to the average cost of the previous units. Lets assume that a company produces 3 units of a good.
The first unit costs $1
The second unit costs $2
The third unit costs $3.
The average cost is (1+2+3)/3=2
Now if the marginal cost for producing a unit is more than the average cost for example if the marginal cost is 4, then this will mean that average total cost is rising. we can mathematically check this.
The first unit costs $1
The second unit costs $2
The third unit costs $3.
The fourth unit costs $4
Average cost= (1+2+3+4)/4=10/4=2.5
Here we see that the average cost increased from 2 to 2.5 because marginal cost was greater than average cost.
Answer:
A change in quantity demanded is caused by a change in price only. That is, when price rises quantity demanded falls vise versa
A change in demand occurs when there is a shift in the demand caused by a change in other determinates of demand other than price such as change in income, change in taste and fashion, demographic changes etc.
Explanation:
Real word example of change in demand :
Changing Tastes or Preferences
From 1990 to 2020, the per-person consumption of chicken by Americans rose from 48 pounds per year to 85 pounds per year, and consumption of beef fell from 77 pounds per year to 54 pounds per year, according to the U.S. Department of Agriculture (USDA). Changes like these are largely due to movements in taste, which change the quantity of a good demanded at every price: that is, they shift the demand curve for that good, rightward for chicken and leftward for beef.
Simply put it this way> Change in quantity demanded : Price change, quantity demanded change
Change in Demand: Price doesn't change but quantity demanded changes as a result of change in other determinates of demand examples the change in preference
Answer:
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Explanation:
