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Based on the choices, Alana is more likely to be a systems analyst. Since she is interested in programming and software, her potential skills would be used extensively in this job, as compared with the other choices.Their job is to analyze computer processes to further improve its efficiency.
Answer:
a) The required rate of return is 14.75%
b) The expected return on this stock is 16% which is more than its required rate of return 14.75%, thus it is underpriced.
Explanation:
a)
Using the SML equation, we can calculate the required rate of return (r) of a stock.
r = rFR + β * (rM - rFR)
r = 6% + 1.25 * (13% - 6%)
r = 0.1475 or 14.75%
b)
The SML shows the return that is required on a security based on the risk is carries. Using SML we calculate the required rate of return which is the percentage return that investors require a security to provide.
If the expected return is greater than the required rate of return which means that security is expected to provide more than is required then the security is underpriced.
The expected return on this stock is 16% which is more than its required rate of return 14.75%, thus it is underpriced.
Cost Volume Profit (CVP) analysis, also known as break-even analysis, is a financial planning tool that executives use to set the short-term strategy for their business. It informs corporate decision makers of the (short-term) impact on profit of changes in selling prices, costs, and quantities.
CVP analysis aims to determine the outputs that drive company value, highlight the impact of fixed costs, break-even points, target profits, and determine sales figures and sales forecasts. CVP analysis makes pricing decisions and pricing structures easier.
CVP analysis estimates how changes in a company's fixed and variable costs, sales volume, and price affect the company's profits. This is a very powerful tool in finance and accounting. It is one of the most commonly used tools in management accounting to help managers make better decisions.
Learn more about CVP at
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The answer would be letter C. This theory tells us that exchange or conversation rates between currencies are in symmetry when their purchasing power is the similar in each of the two republics. In other words, the outlay on a like commodity must be same in both currencies when accounted for exchange rate.
Answer:
c. greater is the chance that the realized return will differ significantly from the expected return
Explanation:
The standard deviation is used as a measure of risk, it measures the dispersion of data relative to its mean. The expected return is measured by the mean, therefore if the standard deviation is large it will be more difficult to be accurate calculating the expected return as the values can differ significantly.
