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vovikov84 [41]
3 years ago
13

Consider two stocks, A and B. Stock A has an expected return of 10% and a beta of 1.2. Stock B has an expected return of 14% and

a beta of 1.8. The expected market rate of return is 9% and the risk-free rate is 5%. Security __________ would be considered the better buy because
Business
1 answer:
barxatty [35]3 years ago
8 0

Answer:

B; it offers an expected excess return of 1.8%

Explanation:

Here are the options :

A; it offers an expected excess return of .2%A; it offers an expected excess return of 2.2%B; it offers an expected excess return of 1.8%B; it offers an expected return of 2.4%

to determine which stock is the better buy, we have to calculate the expected return of the stocks using CAPM

According to the capital asset price model: Expected rate of return = risk free + beta x (market rate of return - risk free rate of return)

Stock A = 5% + 1.2(9% - 5%) = 9.8%

Stock B = 5% + 1.8(9% - 5%) = 12.20%

The next step is to determine the excess return

stated expected return - calculated expected return = excess return

Stock A's excess return = 10% - 9.8% - 0.2%

Stock B's excess return = 14 - 12.20 = 1.8%

Security B would be considered because it has a higher excess return

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Answer:

He does not need to file a tax return

Explanation:

International students on F, J, M, or Q visas are considered “exempt individuals,” which means you are excused from the Substantial Presence Test for the first 5 years you are in the US if you are an international student. A substantial Presence test is the criterion used by the IRS (Internal Revenue Service) in the US to determine if an individual is a citizen for tax purposes or not. Since Wei came into the United States in 2014, and this is 2017 he has not yet exhausted the 5 year period.

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When the change in demand due to seasonality is a constant amount, regardless of trend or average, the seasonal variation is des
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When the change in demand due to seasonality is a constant amount, regardless of trend or average, the seasonal variation is described as Additive Seasonal Variation.

What is Additive Seasonal Variation?

The seasonal component is stated in absolute terms in the scale of the observed series using the additive approach, and the level equation adjusts the series for the season by deducting the seasonal component. The seasonal component will roughly equal zero within each year.

therefore,

When the change in demand due to seasonality is a constant amount, regardless of trend or average, the seasonal variation is described as Additive Seasonal Variation.

to learn more about Additive Seasonal Variation from the given link:

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The ideal bedroom temperature is one that is warm enough to be comfortable but cool enough to
gogolik [260]
This is super True not sure if you still need help
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3 years ago
During the month of march, harley's computer services made purchases on account totaling $45,300. also during the month of march
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The ending balance for March would be $85,700.

You would create a T-account for accounts payable and since accounts payable is a liability, you would credit the beginning balance. The purchases made during the month are also credited because you are increasing the amount in the liability. The $10,700 would not be included because this is unearned revenue and while it is a liability, it does not classify as accounts payable. The $37,800 would be debited since you are decreasing the liability by paying part of it off. 

Once doing so, you add up the amounts on the right side and deduct the amounts on the left: (78,200+45,300)-37,800=85,700
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3 years ago
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