Answer:
The answer is 14.87%
Explanation:
Solution
Given that:
A large company stock had an average return of =12.59%
The average risk free rate = 2.58%
A small company stocks average is =17.45
The next step is to find the risk premium on small-company stocks for this period
Thus,
The risk premium on small-company stocks = Average return on small-company stocks - average risk-free rate
So,
Risk premium on small-company stocks = .1745 - 0.258
=0.1487
Therefore the risk premium on small company stocks for the period was 14.87%
Answer: b. The duration of its liabilities must equal the duration of its assets
Explanation:
Since the company wants to structure its assets and liabilities such that its equity is unaffected by interest rate risk, then the duration of its liabilities must equal the duration of its assets.
It should be noted that when the duration of its liabilities is shorter than the duration of its assets, the duration gap is positive and when there's a rise in interest rate, the worth of assets will be affected more.
When duration of its liabilities is longer than the duration of its assets, the duration gap is negative and when there's a rise in interest rate, the worth of liabilities will be affected more.
Finally, when the duration of its liabilities is equal the duration of its assets, its equity is unaffected by interest rate risk.
Answer:
Annual deposit= $188,842.66
Explanation:
Giving the following information:
Williamsburg Nursing Home is investing in a restricted fund for a new assisted-living home that will cost $6 million.
n= 15 years
i= 10%
We need to use the following formula:
FV= {A*[(1+i)^n-1]}/i
A= annual deposit
Isolating A:
A= (FV*i)/{[(1+i)^n]-1}
A= (6,000,000*0.10)/[(1.10^15)-1]
A= $188,842.66
Answer:
International business is a affects the domestic economy in many ways.
Explanation:
- The impacts of international trade can vary from the supply and demand of a particular good or product and their impact on the domestic market functioning. The price changes in the market affect the wages received by the workers as trade opens new foreign markets.
- The supply of the products is depended on the demands of the consumers which may be affected by the government policies, and many socio-cultural aspects.
- International trade leads to the increase of the value of the products and thus increases in the demands and the competitiveness of the market, for this, the government provides a subsidy to the domestic infant industries to protect them from getting removed for the competition.
- Due to the competition, the firms try to sell their product at a lower or higher cost thereby increasing the quantity demanded by the customer. Thus the equilibrium of the price and quantity demanded changes.
Answer:
d) Mary, who was laid off last year and who was looking for a full-time job until last month
Explanation:
In the United States, a discouraged worker is defined as a person not in the labor force who wants and is available for a job and who has looked for work sometime in the past 12 months (or since the end of his or her last job if a job was held within the past 12 months), but who is not currently looking because of real or perceived poor employment prospects.
