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guajiro [1.7K]
3 years ago
15

A stock with a beta of 0.8 has an expected rate of return of 12%. If the market return this year turns out to be 5 percentage po

ints below expectations, what is your best guess as to the rate of return on the stock?
Business
1 answer:
Sunny_sXe [5.5K]3 years ago
8 0

Answer:

The correct answer is:  The expected rate of return for the stock would be around 7%.

Explanation:

The Beta coefficient is a numeral measure that portraits the volatility of a stock compared to the overall market performance. If a stock's beta is closed to the numerical value one (1) it implies it is highly correlated to the price movement of the overall market.

In that case, if a stock's beta is 0.8 it implies it follows the market price movements. If the stock expected rate return is 12% but the market return turns out to be 5% points below expectations, it means the stock's return would end up being around 7%.

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When a firm changes its capital structure by issuing or retiring debt, for example, this change alters the firms unlevered free
liubo4ka [24]

Answer:

True

Explanation:

Unlevered free cash flows represent the amount of cash a business has before meeting it's financial obligations such as operating expenses or periodic interest payments on borrowed funds.

When a firm issues further debt, it's available funds increase. Similarly, if a firm retires or repays it's debt, it's available funds decrease.

Therefore, change in capital structure by issue or retirement of debt alters a firm's unlevered free cash flows.

7 0
3 years ago
How did rogo improve his factory's performance on each of these dimensions?
matrenka [14]

<span>He took the advice from Jonah. The way he improved included many steps. First he increased throughput by getting cash while staying in the plant. He managed to deliver all the overdue orders which also helped him getting rid of the excess inventory which was a natural result of more sales. Secondly he reduced the inventory by changing the production process. The plant produced more of those parts which were in demand or which were overdue instead of those excess parts which were occupying the inventory and slowing down the progress.</span>

6 0
3 years ago
Optimum Weight Loss Co. offers personal weight reduction consulting services to individuals. After all the accounts have been cl
denis23 [38]

Answer:

*** Cash $37,500

Explanation:

Optimum weight loss classified balance sheet .

Assets

Current assets

Cash $37,500

Account receivables $116,750

Prepaid insurance $7,200

Prepaid rent $21,000

Supplies $4,800

Total current assets $187,250

Non current assets

Equipment $474,150

Less

Accumulated depreciation $186,400

NBV $287,750

Land $300,000

Total non current assets

$587,750

Total assets

$775,000

Liabilities

Accounts payable $37,700

Salaries payable $9,000

Unearned fees $18,000

Total liabilities

$64,700

Equity

Common $75,000

Retained earnings $635,300

Total equity

$710,000

Total liabilities + equity

$710,300 + $64,700 = $775,000

6 0
2 years ago
How many cases of bankruptcy cases are provided for in the bankruptcy code
tia_tia [17]
There are six types of bankruptcy cases that are provided for in the bankruptcy code, They are:

Chapter 7, Chapter 9, Chapter 11, Chapter 12, Chapter 13, Chapter 15

In short, Your Answer would be Option B

Hope this helps!
4 0
3 years ago
In a(n) ________, the consumer ranks a product's attributes in terms of perceived relevance or importance, then compares the var
mafiozo [28]

Answer:

Lexicographic decision rule

Explanation:

A lexicographic decision rule is one of the decision making rules in purchase that allows a product to be ranked according to its importance to the consumer.

When a consumer is to purchase a product, the consumer ranks products that are similar in use as well as how important the product is. This helps a consumer to make the best decision when it comes to purchasing.

Cheers.

6 0
3 years ago
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