I just took it the answer is A
Answer:
13.42%
Explanation:
The computation of return on equity is shown below:-
Debt = Assets × ( Debt to assets ratio)
$155,000 × 37.5%
= $58,125
Equity = Total Assets - Debt
= $155,000 - $58,125
= $96,875
Old Return on equity = Old Net Income ÷ Equity
=$20,000 ÷ $96,875
= 20.64%
New Return on equity = New Net Income ÷ Equity
= $33,000 ÷ $96,875
= 34.06%
Increased in Return on equity = New Return on equity - Old Return on equity
= 34.06% - 20.64%
= 13.42%
Answer:
C) John's decision on how to allocate his time is consistent with the rationality assumption since the decision is intended to make him better off.
Explanation:
One of the pillars of modern economic theory is that individuals are rational and they will try to maximize their benefit at the lowest possible cost. Since resources are finite, then all our decisions are made on the margin. What is the marginal benefit that we can obtain from purchasing something at its marginal cost (marginal cost = sales price for an individual).
In this case, John is trying to maximize his utility, first he will go to the gym which probably provides a larger benefit to him, and then he is going to study (which also provides a benefit). He could have chosen to either go out to somewhere else or just stayed home and watch TV, play videogames, etc., but apparently these activities do not provide him enough benefits but represent a large cost in time.
Answer:
Portfolio's beta is 1.04.
Explanation:
Portfolio's beta is the weighted average beta. So, take weightage of each stock, multiply it with the respective beta, and add the results.
Finding Portfolio value for Weightages:
Total Amount Invested OR Portfolio value is = 10,000 + 40,000 = $50,000
Weighted Average Beta:
(10,000 / 50,000) * (.4) + (40,000 / 50,000) * (1.2) = .08 + .96 = 1.04.
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