The words are
transparent,involved,and empathetic
Answer:
Risk free interest rate is 5%
Y is 15.5% at a Beta of 1.5
X is 0.29 when Y is 7%
Explanation:
Risk free interest is 0.05 which 5% as given in the equation
The average expected return is given by Y
Y=0.05+0.07X
Since Beta is the same as X, when equals 1.5,Y is calculated thus
Y=0.05+0.07(1.5)
Y=0.05+0.105
Y=0.155
Y=15.5%
The value of Beta at an average return of 7% is computed thus:
7%=0.05+0.07X
where X is the unknown
0.07=0.05+0.07X
0.07-0.05=0.07X
0.02=0.07X
X=0.02/0.07
X=0.29
The scenario illustrates that the Beta, which is the risk of investment and the Y , the expected average return are positively correlated.
Answer:
d. -$4,608
Explanation:
The computation of the total capital gain is shown below:
Total capital gains is
= (End value - Beginning value) × 900 shares
= ($34.08 - $39.20) × 900 shares
= -$4,608
Hence, the total capital gain on this investment is -$4,608
Therefore the option d is correct
And, the same is to be relevant
Answer:
Total assets is increased by $18,100
Explanation:
The computation is shown below:
= Cash received from the issue of stock + revenue earned on account - cash paid for operating expenses
= $15,000 + $8,500 - $5,400
= $18,400
This positive amount shows that there is an increase in the total assets for $18,100
The cash collected from the account receivable is not relevant. Hence ignored it
Answer:
Explanation:
Requirement 1
Warranty expense in 2015 = $9,000 x 6%
Warranty expense in 2015 = $540
Note: As mention above Hitzu expects warranty cost to be 6% of dollar sales
Requirement 2
Estimate warranty liability as of Dec 2015 = $540
Requirement 3
Warranty expense in 2016 = 0
Requirement 4
Estimated warrant liability as of Dec 2016 = $540 -$114
Estimated warrant liability as of Dec 2016 = $426
Note: As the repair costs 114 on the same day of repair.
