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babunello [35]
2 years ago
12

Suppose you invest equal amounts in a risky asset with an expected return of 16% and a standard deviation of returns of 18% and

a risk-free asset with an interest rate of 4%. Calculate the standard deviation of the returns on the resulting portfolio.
Business
1 answer:
Serjik [45]2 years ago
6 0

Answer:

The answer is "10\%".

Explanation:

You are equivalent investors in 16 percent of a portfolio and 4 percent of a risk-free asset. A weighted mean of these two will become the predicted return.

= \text{(Portfolio weight} \times \text{Return portfolio)} + \text{(Portfolio weight}\times \text{risk-free)}\\\\

= (0.5 \times 16\%) + (0.5 \times 4\%)\\\\= (0.5 \times \frac{16}{100}) + (0.5 \times \frac{4}{100})\\\\= \frac{8}{100} +  \frac{2}{100}\\\\= \frac{8+2}{100}\\\\= \frac{10}{100}\\\\= \frac{1}{10}\\\\= \frac{1}{10} \times 100\\\\=10\%

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Central Park Inc. is a company that sells women's clothing. It recently shut down its physical store and is operating as an app-
love history [14]

Answer:

M-commerce

Explanation:

Since in the given situation it is mentioned that Central Park Inc sells the women clothing and currently they shut down the physical store and they are operated now through app based. With this feature, anyone could access anywhere via using the mobile phones also at the same time the customer compared the prices

So this situation represent the mobile commerce or M -commerce as the people can access this from anywhere at any time, it is easy to use also it save the cost and time

7 0
3 years ago
"You’ve observed the following returns on Crash-n-Burn Computer’s stock over the past five years: 6 percent, –13 percent, 24 per
Vanyuwa [196]

Answer:

6.80%

Explanation:

The average nominal returns is the sum of the returns for 5 years divided by the number of returns considered( i.e 5, 5 returns for 5 years)

average nominal returns=(6%-13%+24%+18%+15%)/5

average nominal returns=10.00%

The Fisher's equation is shown thus:

(1 + i)  = (1 + r) (1 + π)

i=nominal return=10.00%

r=average real return=the unknown

π=inflation rate=3%

(1+10.00%)=(1+r)*(1+3%)

1.10=(1+r)*1.03

1+1=1.10/1.03

r=(1.10/1.03)-1

r=6.80%

7 0
2 years ago
Vinny asks if he should force Spud to finish the job. Could Oscar get a court order requiring Spud to actually build the display
adell [148]
<span>No, specific performance is not allowed in this case because money damages are available.
In case that a party failed to fulfill the condition that signed on the contract, the court could give 1 of 2 form of punishments.
The first is to forcibly make that party perform the condition (specific performance), the other is to pay back the loss that incurred because of that party fail to fulfill the condition (money damages)</span>
8 0
3 years ago
What is the current value of a $1000 Treasury inflation-protected security if the reference CPI is 203.19 and the current CPI is
faust18 [17]

Answer:

the current value fo $1,000 is $1,011.22

Explanation:

The computation of the current value of $1,000 is shown below:

Current value

= Price × (Current CPI ÷ Reference CPI) × 100

= $1,000 × (205.47 ÷ 203.19)

= $1,011.22

We basically applied the above formula so that the current value would come

Hence, the current value fo $1,000 is $1,011.22

8 0
3 years ago
An Empirical Bargaining Model with Digit Bias – A Study on Auto Loan Monthly Payments
dedylja [7]

Answer:

This study was carried on by Jiang, Zhenling, during the first semester of 2019 and it involved more than 35 million auto loans in the US. The author determined that monthly payments carrying a $9 ending digit, e.g. $199, had a highest interest rate charged. While those monthly payments carrying a $0 ending digit, e.g. $200, had the lowest interest rate charged. African American and Latin consumers were the most negatively affected groups by the higher interest rates.

The study showed that an effective bargaining tactic would decrease total payments significantly. This research also includes a lot of other information regarding the total economic effects of ending digit bias.

Explanation:

I personally guess that many car sellers and auto loans institutions tempt both African American and Latin consumers by using apparently lower monthly payments (psychologically we all consider $199 to be much cheaper than $200) in order to charge higher interest rates. They also probably offer longer term loans, e.g. 5-6 year loans instead of 3-4 year loans.

3 0
2 years ago
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