Answer:
1. Using CAPM, the required return is;
Required return = risk free rate + beta * market risk premium
= 6% + 1.5 * 9%
= 19.5%
2. First find the portfolio beta which is a weighted average of the individual betas;
= (60% * 2.4) + (40% * 0.9)
= 1.8
Now use CAPM
= risk free rate + beta * (Market return - risk free rate)
= 4% + 1.8 * (13% - 4%)
= 20.2%
3.Geometric average can be calculated by;
=( ((1 + r1) * (1 + r2) * (1 + r3)) ^1/n) - 1
= (((1 + 6%) * (1 + 10%) * (1 - 6%)) ^ 1/3) - 1
= (1.09604^1/3) - 1
= 3.1%
The variance for net operating income in the revenue and spending variance column on the flexible budget performance report) for September would be closest to $910.
Explanation:
Following are the cost which are listed as follows,
- Variable element per month client-visit Revenue = $44.50
- Personnel expenses= $26,100 $12.60
- Medical supplies= 6007.20
- Occupancy expenses= 6,500
- Administrative expenses= 3,100
- Total expenses= $36,300 $22.30
- Actual results achieved in the month of September is as under:
- Revenue= $93,240
- Personnel expenses= $50,754
- Medical supplies= $15,328
- Occupancy expenses =$11,646
- Administrative expenses= $3,394
- The formula for net operating income is calculated by subtracting the operating expenses from the total revenues.
- A flexible budget variance is known as the difference between the results incurred by a flexible budget model and the actual results.
- For the month of September, the cost would be closest to $910.
Answer:
c) increase; decrease
Explanation:
Macro prudential policies or regulations basically aim for company's entire financial risk management. This tries to regulate the risk by various steps and measures.
In the given case also,
By increasing the capital requirements during the expansion because expansion would result in great performance and that decreasing the capital requirements during the down turn as the performance would not be good.
Answer:
An oligopoly market structure is very usual in the context of Australian. Maximum service industry like banking, retail etc. follow the market structure of the oligopoly. The grocery retail sector in Australia is a core example of the duopoly, a narrowed version of oligopoly (Chung, 2015). Moreover, the banking sector of Australia is a proper example of an oligopoly. The main feature that the oligopoly market structure follows is, in this type of market few firm operate as a sole authority in a market (LaFrenz, 2014). In the case of monopoly, there is only one seller who rules the whole market and business as well. The monopolistic competition involves firm competing strongly among them in an industry. They do not allow any other organisation to enter the market. The Australian Post is a major example of monopoly market structure. Banking and Retail sectors are the key examples of monopoly market structure (Welch & Welch, 2009).
Apart from the banking industry, the retail industry in Australia faces very strong competition. The giant monopolistic retail companies named Coles and Woolworths have grabbed maximum market share in the industry. It is being very difficult for all other small and big organisation to sustain in the market. It is surveyed that, the banking industry of Australia is facing strong competition or oligopolistic war. Smith (2015), has informed that the existent incumbents in the banking industry are strictly prohibiting the other new entrants for the sector (Smith, 2015).
Explanation:
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