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Tpy6a [65]
3 years ago
15

The Delta Co. owns retail stores that market home building supplies.​ Largo, Inc. builds single family homes in residential deve

lopments. Delta has a beta of 1.22 and Largo has a beta of 1.34. The riskminus free rate of return is 4 percent and the market risk premium is 6.5 percent. What should Delta use as their cost of equity if they decide to purchase some land and create a new residential​ community?
Business
1 answer:
cupoosta [38]3 years ago
4 0

Answer:

12.71%

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)

= 4% + 1.34 × 6.5%

= 4% + 8.71%

= 12.71%

The (Market rate of return - Risk-free rate of return)  is also called market risk premium and the same is used in the computation part. We ignored the bets of Delta

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For each of the following situations, identify the type of form to be filed with the SEC for disclosure purposes (2 points): (A)
oee [108]

Answer:

1. Form 8-K : A unique or significant happening.

2. Form 10-K: Annual information required by Regulation S-X.

3. Form 8-K: Changes in control of the registrant.

4. Form 10-Q: Interim financial statements.

5. Not required: Fourth quarter income statement.

6. Form 8-K: Bankruptcy.

7. Form 10-K: Annual information required by Regulation S-K.

8. Form 10-Q: Income statement for the current quarter, year-to-date, and comparative periods in the previous year.

9. Not required: Changes in bookkeeping staff.

10. Form 8-K: Changes in the registrant's independent auditor.

Explanation:

The SEC, an acronym for Securities and Exchange Commission was created under the Securities Exchange Act of 1934. The Act empowered the SEC to require registration of securities, security exchanges, and reporting by publicly owned firms.

Some of the forms to be filled as required by the United States of America, Securities and Exchange Commission (SEC) includes;

1. Form 10-K.

2. Form 10-Q.

3. Form 8-K.

5 0
3 years ago
A father and his son are celebrating the father's 75th birthday. Drink for drink, who will most likely have a higher BAC ?
Temka [501]
The one who will most likely have a higher BAC is the father because a person who is older will most likely have the higher BAC, as the father is already seventy five and much older to his son, he will be therefore have a higher BAC compared to his son.
4 0
3 years ago
Read 2 more answers
If the Fed purchases government securities from a commercial bank, which of the following will happen?a.The Fed will increase th
solniwko [45]

Answer:

The correct answer is letter "E": "A" and "B".

Explanation:

In order to accomplish its monetary policy, the Federal Reserve (<em>Fed</em>) buys and sells securities in the open market to control the money supply. If there is more money supply in the open market, loan rates will decrease allowing investors to access more capital. At the same time, the Fed reserves and assets will increment.

3 0
2 years ago
The _____ adds up the money earned by producers plus taxes paid to the government.
Nikolay [14]
Income Approach seems to fit best but i'm not quite sure.
Sorry if it's wrong.
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3 years ago
The following is a partially completed lower section of a departmental expense allocation spreadsheet for Brickland. It reports
Arada [10]

Answer:

a. $6,400.

Explanation:

In solving this question on Computing the amount of Purchasing department expense to be allocated to Assembly, we'll have to use the formula below:

Purchasing department expense to be allocated to Fabrication = Total Cost of purchasing department X number of purchase order in / Total numbers of purchase orders in all operating departments

= $32000 X 4/20 = $6,400

3 0
3 years ago
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