Security X has an expected rate of return of 13% and a beta of 1.15. The risk-free rate is 5%, and the market expected rate of r
eturn is 15%. According to the capital asset pricing model, security X is ________.
A) fairly priced
B) overpriced
C) underpriced
D) None of the above
A) fairly priced
B) overpriced
C) underpriced
D) None of the above
1 answer:
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Answer:
(B) $20 billion
Explanation:
Given a certain level of MPC, an increase in government spending (G) by a certain amount translates to an increase in aggregate demand (AD) through the relationship below.
where Δ means <em>change.</em>
<em />
Therefore, given ΔAD of $50 billion, and MPC of 0.6,
=
=
= ΔG = 50 * 0.4 = 20
Therefore, increase in government purchases = $20 billion.
Answer:
net capitalized cost is = $450000
so correct option is b. $450,000
Explanation:
given data
capitalized software costs = $600,000
expected total sales = 10%
sale = 4 year
net realizable value = $480,000
solution
we find out net capitalized cost of computer software that is
net capitalized cost of computer software is = Year 1 balance - Year 2 amortization ........................1
here we get first Year 2 amortization that is
Year 2 amortization is = capitalized software costs ÷ total projected sale ..............2
put here value
Year 2 amortization =
Year 2 amortization is = $150,000
so here we get net capitalized cost
net capitalized cost is = $600,000 - $150,000
net capitalized cost is = $450000
so correct option is b. $450,000