1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
kifflom [539]
2 years ago
14

You own a portfolio equally invested in a risk-free asset and two stocks. If one of the stocks has a beta of 1.08 and the total

portfolio is equally as risky as the market, what must the beta be for the other stock in your portfolio?
Business
1 answer:
Luden [163]2 years ago
4 0

Answer: 0.92

Explanation:

Beta is a measure of riskiness and Market beta is always 1.

The total portfolio therefore has a beta of 1.

Portfolio Beta is weighted average of the betas of the composite stocks.

The stocks are equally invested in so their weights are 0.5.

Assume the beta needed is x.

(0.5 * 1.08) + (0.5 * x) = 1

0.54 + 0.5x = 1

0.5x = 1 - 0.54

x = 0.46/0.5

= 0.92

You might be interested in
What do the three numbers at the bottom of the check stand for?
Vadim26 [7]

Answer:

Routing number, account number and check number

Explanation:

There are three numbers present at the bottom of the check. On the left side or the first number is a nine digit number that is also called RTN, is routing number. This represents the code of the bank where the account was opened.

Second number in the middle is the account number which is a unique number. All transactions are carried out using this number.

The last number on the right side is the check number. It just represents the check number that one is writing to maintain records.

5 0
3 years ago
Read 2 more answers
The government sector get its income mostly from exports to other countries.
barxatty [35]

Answer:

False

Explanation:

The government sector derives its main incomes from taxes.

3 0
3 years ago
Which is the most accurate statement about trade? a. Trade can make every person better off. b. Trade helps rich people and hurt
laiz [17]

Answer:

a. Trade can make every person better off.

Explanation:

Trade generates a benefit for all parties trading. If a party do not fell like winning with trade, it will stop trading and the trade will not occur. It is important for each party to make sure the other wants to keep trading, so quantity and price will be based upon both parties agreement.

A person can trade for product she produces, for example a person who produce a certain fruit can buy the same fruit when is off-station in their side of the world with another producer.

It could also trade becasue is the raw material of a finished product and it need more input for his facilities.

If a person or a party who is trading thinks is worse than before the trade, then it will stop trading so, as long as there is trade, both parties are better off after the trade.

7 0
3 years ago
has 17,500 shares of stock outstanding along with $408,000 of interest-bearing debt. The market and book values of the debt are
Naddik [55]

Answer:

$926,073

Explanation:

Enterprise value=market capitalization+value of debt-cash

value of the firm=price-earnings ratio=11.8

earnings=net income

net income=profit margin*sales

net income=$697,000*6.8%=$47,396

11.8=market capitalization/$47,396

market capitalzation=11.8*$47,396=$559,272.80  

enterprise value=$559,272.80+$408,000-$41,200=$ 926,072.80  (approx  $926,073)

6 0
2 years ago
True or false: It's inevitable that budgeting will hinder enjoyment of life, forcing people to make financial sacrifices.
NeTakaya

Based on financial analysis, it is <u>False</u> that It's inevitable that budgeting will hinder the enjoyment of life, forcing people to make financial sacrifices.

<h3>What is Budgeting?</h3>

Budgeting Is the process of making a financial plan which includes planning on expenses, revenue, savings, assets, liabilities, cash flow, etc.

<h3>Benefits of Budgeting</h3>

There are various benefits of budgeting, some of which include the following:

  • For providing limits or guides to spend.
  • To achieve financial goals.
  • To prepare for emergencies.
  • To aid better retirement, etc.

Hence, in this case, it is concluded that the correct answer is "<u>False</u>."

Learn more about Budgeting here: brainly.com/question/22532334

7 0
2 years ago
Other questions:
  • Ballard Company uses the perpetual inventory system. The company purchased $16,000 of merchandise from Andes Company under the t
    14·1 answer
  • The following data were taken from the financial statements of Gates Inc. for the current fiscal year. Property, plant, and equi
    12·1 answer
  • As long as total utility is increasing, we know that marginal utility is:
    9·1 answer
  • When the "full-cost approach" to marketing cost analysis is used, allocating fixed costs on the basis of sales:A. may make low-v
    13·1 answer
  • On 3/15/20, Robertson Corp. bought land from Lear, Inc. for $248,000. Lear had carried the land on its books at $240,000. Robert
    7·1 answer
  • Let’s examine how the goals of the Fed influence its response to shocks. Suppose that in scenario A the Fed cares only about kee
    13·1 answer
  • Use the following information for ECE incorporated: Assets $200 million Shareholder Equity $100 million Sales $300 million Net I
    12·1 answer
  • according to the basic dcf stock valuation model, the value an investor should assign to a share of stock is dependent on the le
    13·1 answer
  • What role does competition play in business and global trade?
    6·1 answer
  • To win back customers after they have discontinued service, when should the initial communication be made? g
    10·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!