Answer:
1.15
Explanation:
If investment is made in equal proportions, it means that;
weight in risk free ; wRF = 33.33% or 0.3333
Let the stocks be A and B
weight in stock A ; wA = 33.33% or 0.3333
weight in stock B; wB = 33.33% or 0.3333
Beta of A; bA = 1.85
Let the beta of the other stock be represented by "bB"
Beta of risk free; bRF = 0
Beta of portfolio = 1 since it is mentioned that "the total portfolio is equally as risky as the market "
The weight of portfolio is equal to the sum of the weighted average beta of the three assets. The formula is as follows;
wP = wAbA + wBbB + wRF bRF
1 = (0.3333 * 1.85) + (0.3333*bB) + (0.3333 *0)
1 = 0.6166 +0.3333bB + 0
1 - 0.6166 = 0.3333bB
0.3834 = 0.3333bB
Next, divide both sides by 0.3333 to solve for bB;
bB = 0.3834/0.3333
w=bB = 1.15
Therefore, the beta for the other stock would be 1.15
When the person uses his personal belongings to change the overall amount of his financial leverage then it will be called Homemade Leverage.
Homemade Leverage was provided by The Modigliani-Miller Theory. This theory assumes an efficient market and it also assumes the absence of corporate taxes and the cost of bankruptcy. Homemade leverage gives the power for investors to borrow on the same terms as the company. So in this way, it can create the effects of corporate leverage.
The advantage of this method is that we can use it to incorporate the cash flows that come from risk-free assets without relying on the findings of the fund manager. This allows us to borrow and also lend at a specific risk-free rate of interest and to build a leveraged accurate return for the company.
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Answer:
$40,000
Explanation:
The computation of the goodwill amount is shown below:
= Paid amount + liabilities - current assets - plant and equipment - carrying amount value
= $600,000 + $400,000 - $80,000 - $760,000 - $120,000
= $40,000
This $40,000 indicated the goodwill amount reported in its consolidated balance sheet
All other information which is given is not relevant. Hence, ignored it
Answer:
you need to go to settings than press profile than you should be able to edit it and change your pic
<u>Spillover effect</u> is when employers seek to avoid unionization by offering workers the wages, benefits, and working conditions that rival unionized firms do.
Joining a union only signifies that you, your coworkers, and the union have a voice in critical employment-related issues since these issues are negotiated collectively. As a result, it could be possible to get pay raises, improved health care access, more workplace safety, and more manageable and regular hours.
Because of a shift in the workforce's composition toward people with lower skills or less experience, unionization lowers employment as well as average earnings. When women with young children are employed, the EITC significantly lowers poverty rates.
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