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Daniel [21]
3 years ago
14

The difference by which the required discount rate exceeds the risk-free rate is called the

Business
1 answer:
Keith_Richards [23]3 years ago
5 0
Risk premium. 

The risk premium is the difference between the required discount rate and the risk-free rate, as measured by T-bills. This risk premium is important for computing the CAPM and other portfolio management equations. 
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Active trading in markets and competition among securities analysts helps ensure that: I. Security prices approach informational
Anika [276]

Answer:

The answer is: All the options are correct (I, II and III)

Explanation:

The larger the number of individuals (e.g. securities analysts, investors) who are informed about the price system of securities, the prices of securities will approach informational efficiency.

When the system approaches informational efficiency, you can determine which securities are riskier than others. Therefore you can price riskier securities so that they offer higher expected returns.

The other positive effect of informational efficacy is that investors can determine which securities are undervalued or overvalued.

8 0
3 years ago
Quest Outdoor Store orders River Run-brand kayaks from Sports Merchandise, Inc. Sports Merchandise ships kayaks of the wrong siz
Sidana [21]

Answer:

Sports Merchandise

Explanation:

According to the situation that has been described in the question it can be said that the loss is suffered by Sports Merchandise. This is because a the seller of a good or product is liable for that product until the buyer purchases the product and decides to keep it. Which in this scenario since Sports Merchandise made a mistake on the product size and Quest decided not to accept the product then the responsibility and risk of loss remained with Sports Merchandise as the owner of the product.

5 0
3 years ago
Hugo decides to buy his Christmas gifts on Black Friday. To simplify his life, he is giving his 10 closest friends scarves for C
yarga [219]

Answer:

$8

Explanation:

Consumer surplus is the difference between the willingness to pay of a consumer and the price of the product.

Consumer surplus = willingness to pay - price

The consumer surplus of the 10th scarf :

Willingness to pay for the 10th scarf - price of the scarf

Willingness to pay for the 10th scarf =  $200 / 10 = $20

Consumer surplus = $20 - $12 = $8

I hope my answer helps you

5 0
3 years ago
Read 2 more answers
Which of the following circumstances usually comes before a period of economic contraction?
erik [133]
C
A low GDP for two or more consecutive quarters is usually followed by economic contraction. 
8 0
3 years ago
The predetermined overhead rate is based on the relationship between _____.
Maslowich

Answer:

(A) estimated annual costs and expected annual activity

Explanation:

The formula to compute the predetermined overhead rate is shown below:

Predetermined overhead rate = (Total estimated manufacturing overhead) ÷ (estimated direct labor-hours or estimated machine hours)

It is always calculated on the estimated amount and estimated annual activity i.e direct labor hours or machine hours

So the correct option is a.

7 0
3 years ago
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