Answer:
Currently the price of homes has exceeded the 2006 peak, just before the housing bubble burst. The price index has increased more than 40% since 2012.
It has been many years now of a strong economy, with an economic expansion lasting for 11 years (since June 2009), which is actually record breaking. A lot of economists were expecting a recession soon, with the current health crisis not helping, and the recession finally arrived on June 2020.
The combination of historically high prices for homes and an economic recession can be very hurtful. The advantage of the current situation is that the level of delinquent or subprime mortgages is currently much lower than 14 years ago. Actually, the amount of debt per household has decreased since 2006, and is quite stable right now at moderate or low levels. Many households spent much of the past years paying off debt, so they didn't have time to take new debt.
If the recession gets worse, a price correction will be inevitable, but it wouldn't be as large as the 2007 decrease. Only in a few cities in California, Washington, Nevada and Oregon can you find situations similar to 2006, where a strong supply hasn't been enough to balance the prices due to a stronger demand and high mortgage debt. But even there, the situation will not be as bad.
Answer:
the answer is b
Explanation:
cause its the annual cash outflow
Answer:
13.64%
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)
= 4.8% + 1.7 × (10% - 4.8%)
= 4.8% + 1.7 × 5.2%
= 4.8% + 8.84%
= 13.64%
The (Market rate of return - Risk-free rate of return) is also called market risk premium
Answer:
A License
Explanation:
Burger Boy Restaurant Corporation allows its trademark to be used as part of a domain name for BurgerBoyNY, Inc., an unaffiliated company. Burger Boy NY does not obtain ownership rights in the mark. This is a license. When one firm gives its rights to another firm under this type of contract, the ownership rights always remains with the parent company and licensee can't have ownership rights, they can use only the name and products of that parent company to the customers, but ownership held with the parent company. For example, when KFC and McDonald's gives the right to make and sell their products all over the world, the ownership rights are always reserved with the parent company.
Answer:
hope this helps
Assume that you hold a well-diversified portfolio that has an expected return of 11.0% and a beta of 1.20. You are in the process of buying 1,000 shares of Alpha Corp at $10 a share and adding it to your portfolio. Alpha has an expected return of 21.5% and a beta of 1.70. The total value of your current portfolio is $90,000. What will the expected return and beta on the portfolio be after the purchase of the Alpha stock? Do not round your intermediate calculations.
Old portfolio return
11.0%
Old portfolio beta
1.20
New stock return
21.5%
New stock beta
1.70
% of portfolio in new stock = $ in New / ($ in old + $ in new) = $10,000/$100,000=
10%
New expected portfolio return = rp = 0.1 × 21.5% + 0.9 × 11% =
12.05%
New expected portfolio beta = bp = 0.1 × 1.70 + 0.9 × 1.20 =
1.25
Explanation:
