1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
TEA [102]
3 years ago
14

Assume that the risk-free rate remains constant, but the market risk premium declines. Which of the following is most likely to

occur? a. The required return on a stock with beta = 1.0 will not change. b. The required return on a stock with beta > 1.0 will increase. c. The return on "the market" will remain constant. d. The return on "the market" will increase. e. The required return on a stock with a positive beta < 1.0 will decline
Business
1 answer:
slava [35]3 years ago
6 0

Answer: The required return on a stock with a positive beta < 1.0 will decline.

This is the correct answer because when the market risk premium declines  

the required return on stocks with any positive beta will decline. The reason for this is that Beta is the sensitivity of the stock to the market premium so if the market premium declines, if the beta is positive the return will decline

Example Capm RR= RF+B(RP)

If the RF= 5%

RP=5%

Beta of stock is 0.5

The required return on the stock will be 0.05+0.5(0.05)=0.075=7.5%

If the RP declines and goes to 2%

Then Required return will be equal to 0.05+0.5(0.02)=0.07=7%

Explanation:

You might be interested in
A company fails to do a background check that would have revealed that a person it has hired has the potential to harm others. T
padilas [110]

Answer:

The correct answer to the following question is negligent hiring .

Explanation:

Negligent claim can be defined as a legal claim made by an individual ( who can be an employee or customer ) against the employer, because the individual has been injured by the employee who has a history of doing such incidents with others. This hiring claim ( negligent ) argues that the employer should have know about the history of such employees who are threat to other employees and customers.

6 0
4 years ago
1.The percentage of the labor force that belongs to a union is known as the
Helen [10]
1) The percentage of the labor force that belongs to a union is known as the UNIONIZED PERCENTAGE RATIO.

2) The equilibrium wage rate is determined by the point of intersection of labor market supply and labor market demand. Equilibrium wage is the wage where the company agrees to pay and the worker agrees as the value of his work.

3) The effect of union exclusion of nonunion workers is to lower the wages of nonunion workers.

4) A market with one buyer and one seller is a bilateral monopoly. Monopoly is a market with only one seller. Monopsony is a market with only one buyer.
4 0
3 years ago
At which stage of the organizational buying decision process would purchasing and engineering personnel visit potential supplier
STatiana [176]

Answer: Alternative evaluation.

Explanation:

Alternative Evaluation is the phase of the purchaser decision process where the consumer makes use of the information gotten from the information search to assess other brands in the category of the product.

For example, if a consumer is assessing a group of television and he or she has identified three attributes like price, performance and design. The consumer will assess each brand and make decision based on his or her assessment.

7 0
3 years ago
Dax has been promoted to a first-line manager. Dax's new position will require him to spend a lot of time
monitta

Answer

This new position as a first line manager will require him to operate his departments. This role requires him to assign tasks, manage the work flow, monitor the quality of work, solve the employees problems and keep informing the middle and executive managers on challenges and success on the ground level of the company.

Explanations

First-line managers provide firsthand information on true challenges and can offer better and workable solutions. This is because they have the immediate view of the outcomes of the policies, strategies, marketing approaches and production capabilities of the company. They have the ear of upper managers, where they will offer solutions that can improve the processes in the company and the procedures. In addition to that, first-line managers are expected by the work-group employees to protect them from policies and initiatives which are unreasonable.



5 0
3 years ago
What is one difference between fixed-rate mortgages and variable-rate mortgages?
satela [25.4K]
The correct answer should be <span>B. The interest rate may change depending on the condition of the economy.

Fixed-rate mortgages keep the same rates as they were declared at the time of the contract signing, which can either be great for the person or the bank depending on the economy fluctuations. Variable-rate mortgages change based on the economy which means that the conditions are always kept to a certain standard.</span>
6 0
4 years ago
Other questions:
  • _____ leadership is a form of leadership in which the leader solicits input from subordinates.
    8·2 answers
  • The general term employed to indicate an expense that has not been paid or revenue that has not been received and has not yet be
    14·1 answer
  • The answer is actually D. All of the above.
    10·1 answer
  • All states withhold state income taxes. true false
    15·1 answer
  • Brief Exercise 186 For the items listed below, indicate whether the item is an asset, liability, or stockholders' equity item. 1
    10·1 answer
  • ecan Theatre Inc. owns and operates movie theaters throughout Florida and Georgia. Pecan Theatre has declared the following annu
    13·1 answer
  • Which of the following management responsibilities often involves evaluating the results of operations against the​ budget?
    14·1 answer
  • Michael's Machine Shop reports the following information for the quarter.
    7·1 answer
  • Lisa Frees and Amelia Ellinger have been operating a catering business for several years. In March, the partners plan to expand
    9·1 answer
  • How long does it take for an apartment application to be approved?.
    14·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!