Answer:
a.) The beta of an "average stock," or "the market," can change over time, sometimes drastically.
Explanation:
Estimation using betas in finance can be associated to the (CAMP) Capital Asset Pricing Model, it allows the calculation of volatility of the stock in relation to the market.
It should be noted that there are potential problems that can be experienced when estimating and using betas, and these are;
1) Sometimes, during a period when the company is undergoing a change such as toward more leverage or riskier assets, the calculated beta will be drastically different from the "true" or "expected future" beta.
2)The beta coefficient of a stock is normally found by regressing past returns on a stock against past market returns. This calculated historical beta may differ from the beta that exists in the future.
3)The fact that a security or project may not have a past history that can be used as the basis for calculating beta.
4) Sometimes the past data used to calculate beta do not reflect the likely risk of the firm for the future because conditions have changed.
Hence among the given option, option A is false.
Answer:
sorry I can't................,
Answer:
a. True
Explanation:
In the case when there is a delivery of an asset so it would be very rare that it should be made in the forward contract as the delivery of an assets should be made in the future contract. As the forward contract settles at the time when the agreement is closed while the future contract deals with the terms and conditions related to the trading
So the given statement is true
,Answer:
$23,910
Explanation:
The computation of the amount of equity income should Akron report for 2018 is given below:
But before that the amortization is
Purchase price $97,500
carrying value ($390,000 ×5%) $19,500
Total fair value $117,000
Less: net book value ($287,000 × 0.30) $86,100
Franchise agreement $30,900
Divided by Remaining life 10
annual amortization $3,090
Now the amount of equity income is
= $90,000 ×30% - $3,090
= $23,910
