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Readme [11.4K]
3 years ago
15

Greta, an elderly investor, has a degree of risk aversion of a = 3 when applied to return on wealth over a one-year horizon. She

is pondering two portfolios, the s&p 500 and a hedge fund, as well as a number of one-year strategies. (all rates are annual and continuously compounded.) the s&p 500 risk premium is estimated at 5% per year, with a sd of 20%. The hedge fund risk premium is estimated at 10% with a sd of 35%. The returns on both of these portfolios in any particular year are uncorrelated with its own returns in other years. They are also uncorrelated with the returns of the other portfolio in other years. The hedge fund claims the correlation coefficient between the annual returns on the s&p 500 and the hedge fund in the same year is zero, but greta is not fully convinced by this claim. Compute the estimated annual risk premiums, sds, and sharpe ratios for the two portfolios
Business
1 answer:
Mars2501 [29]3 years ago
5 0

Answer:

<u>Risk premiums </u>= Alpha A x Risk Premium

S&P Portfolio Risk premiums = 3 x 5% = 15%

Hedge Fund Portfolio Risk premiums = 3 x 10% = 30%

<u>SDs</u> = Sd x √(A)

S&P Portfolio = 20% x √(3) = 34.64%

Hedge Fund Portfolio = 35% x √(3) = 60.62%

<u>Sharpe ratios </u>= Risk premium / SDs

S&P Portfolio = 15% / 34.64% = 0.43

Hedge Fund = 30% / 60.62% = 0.49

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Juanita corporation uses a job-order cost system and applies overhead on the basis of direct labor cost. At the end of October,
Bingel [31]

Answer:

$1,730

Explanation:

Currently, the job order contains the following costs:

  • Direct materials $480
  • Direct labor $150
  • Manufacturing overhead $600 (or $4 per $1 of direct labor)

Since the manufacturing process still requires $100 more of direct labor, it should also require $400 more of overhead costs. So the total cost of the job order will be:

($480 + $150 + $600) + ($100 + $400) = $1,730

4 0
3 years ago
You are thinking about the things that can go wrong on your trip home over the Thanksgiving break. You have booked a flight with
pashok25 [27]

Answer: 89.5% or 0.895

Explanation:

Probability of you making it home if the flight is canceled:

= Probability that flight is canceled * probability that Walter has a seat

= 35% * 70%

= 24.5%

Probability of you making it home by flight:

= 100% - 35%

= 65%

Probability of you making it home for the holidays:

= Prob. if flight is canceled + Prob. by flight

= 24.5% + 65%

= 89.5%

4 0
3 years ago
This is to inform you that your letter of April 4 has been circulated to me, as I am in charge of such requests. After your inqu
Lorico [155]

Answer:

1.Subject line: _____________ Supply of Suffocation Warning Bags

2. Opening sentence: ____________ We acknowledge the receipt of your request, dated April 4, 2021, for the supply of Suffocation Warning Bags.

Explanation:

A business letter requires the use of a suitable subject line to summarize the topic of the correspondence.  It enables the recipient to clearly and quickly understand the topic.  The opening sentence should fully make reference to the subject with an acknowledgement of the inquiry earlier received from the recipient.

4 0
3 years ago
In general, what are the benefits of the Internet to (i) the business person, (ii) an organization, (iii) a nation and (iv) a gl
steposvetlana [31]

Answer:

Explanation:

The Internet is essential for a successful business. The Internet helps businesses to achieve their goals and succeed in this competitive market. Marketing is important for business, and in this case the internet is the first and most important marketing tool for business owners. The Internet gives entrepreneurs great advantages in building a business infrastructure based on customer data and information. In this modern era, successful work without the Internet is impossible. The Internet has changed the ways in which education, communication and data are imported and exported. Internet technology provides excellent data management resources to offer customers unique and creative solutions.

The benefits of turning the organization world to the Internet are immense. The Internet provides great opportunities for organizational suppliers and cost reduction at all stages of the manufacturing process. Supply costs can be reduced through increased markets and increased competition through online supply systems. Another option is to transfer sales and data to cheaper channels. The Internet can significantly accelerate the market by reducing the time needed to transfer, purchase and process daily business contacts such as purchase orders, invoices and shipping. notifications. The Internet has greatly expanded the area of ​​information management: documents and technical documentation can be changed in real time, legally recognized signatures can be used, browsers can be accessed from suppliers and customers' data systems, and processes can be completed faster.

The Internet is a very effective tool for the nation. It has the potential to increase productivity through various but mutually reinforcing ways, including:

- Significantly reduce the cost of many operations required for the production and distribution of goods and services;

- Increase managerial efficiency, especially for companies to manage supply chains more efficiently and to communicate more easily within the company and with customers and partners;

- Increasing competition, price transparency and expanding markets for buyers and sellers;

Increasing marketing and pricing efficiency;

- Increase consumer choice, comfort and satisfaction in a variety of ways.

Many people like to think that mankind is at the beginning of a new era of enlightened communication. The visions are packed with how we can live, work, work and change our interactions with digital technology. It is believed that the Information Age will bring about fundamental change and development and that all countries around the world are building the necessary infrastructure, the "data highways" to respond to the challenges of twenty information societies. It is assumed that the digital revolution promises a lot of progress for developing countries and is allowed to leapfrog the more developed countries by leaps and bounds. The idea of ​​joining the global information society is strongly defended not only by business interests, but also worldwide. Increasingly, the measures are aimed at bringing new information technologies to less developed regions of the world, political agendas at the international, regional and national levels and less international development efforts. to improve people's lives. However, it is important to think about what these needs are if they are properly implemented. Disadvantaged people face major health problems, lack of education, and difficulties in ending.

6 0
3 years ago
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goldfiish [28.3K]

Answer:

Please Stop

Explanation:

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