Answer:
a) Portfolio ABC's expected return is 10.66667%
Explanation:
The expected return is based on the risk factor of a project. If a project has higher risk its rate of return will be higher. Portfolio ABC has one third of its funds invested in each stock. The return of on A and B are 20% and 10%. Their beta is 1.0 for both the stocks while stock C has beta 1.4. The portfolio expected return will be 10.66667%.
Answer:
Analogy is defined as a comparison between two things with an aim of clarification and explanation
- (D) A firm director describes the differences between documentary and fictional films to a group of people.
Definition means of a text, word,action or concept.
- (B) A professor asks his students to read the poem as if they are reading poetry for the very first time.
Visual Demonstration is an illustrative matter, for example a model, film or a slide designed to supplement spoken or written information in order to be understood easily.
- (A) The owner of a local coffee shop hangs up a map showing the countries the shop purchases it's coffee from.
Answer:
Explanation:
In the first case flour can be counted as final good as it was consumed just after that . Bread for self consumption is not a good . On the other hand bread
is a final good in second case as it had some commercial value . Flour is work- in -process.
Answer:
Cash $10,430 ; Cash equivalents $20,400
Explanation.
Cash consist of all currencies in hand or any convertible asset which can be converted to cash immediately.
It is to be noted that the assets with high liquidity will be included in cash and cash equivalent balance. They can quickly be converted to cash and would normally have 90 or lesser days to mature.
Solution.
$
Cash in bank. 8,540
Petty cash. 250
Check from customer. 1,350
Money order. 290
Cash. 10,430
The check has a very short maturity period since it will clear within 3-4 working days.
Money order can be cashed immediately .
Therefore;
Cash value is $10,430
For cash equivalent,
Cash equivalent = Money market fund balance + Treasury bills maturing in 60days
Cash equivalents = $10,400 + $10,000
=$20,400.
The amounts considered as cash and cash equivalents as of 31 December are ;
Cash $10,430 , $20,400 respectively.
Through the expectations hypothesis and the liquidity preference theory of the term structure of interest rates, liquidity must be zero for the forward rate to be equal to the expectations of future short rates.
<h3 /><h3>What is expectation theory?</h3>
Corresponds to a forecast of short-term interest rates by analyzing them against current long-term interest rates.
Therefore, it is a theory used to assist in better understanding and forecasting short-term securities trading in the future.
Find out more about expectation theory here:
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