0.75m + 5 = 0.5m + 9
0.75m - 0.5m = 9 - 5
0.25m = 4
m = 4 / 0.25
m = 16 <=== at 16 miles, the companies will charge the same amount
20 players after 4th round
The first round start with 40 players.But since after each round half are eliminated then it will be 20 after the 4th round
Answer:
![MRP=\frac{12.25\% -5.00\%}{1.25}=5.8 \%](https://tex.z-dn.net/?f=MRP%3D%5Cfrac%7B12.25%5C%25%20-5.00%5C%25%7D%7B1.25%7D%3D5.8%20%5C%25%20)
Step-by-step explanation:
Previous concepts
The Capital Asset Pricing Model (CAPM) is a concept that "analyze the relationship between risk of any type and the definition of expected return about the assets".
By definition the Market risk premium is defined as "the difference between the average return and the return on a risk-free".
The value of
represent an adimensional number that allows to measure if we create more/low risk on any investment.
Solution to the problem
Assuming that we can use the capital asset pricing model we can calculate the market risk premium (MRP) with the following formula:
![MRP= \frac{ER -RFR}{\beta}](https://tex.z-dn.net/?f=%20MRP%3D%20%5Cfrac%7BER%20-RFR%7D%7B%5Cbeta%7D%20)
Where:
ER= Expected return = 12.25 %
RFR= Risk free rate= 5.00%
![\beta = 1.25](https://tex.z-dn.net/?f=%5Cbeta%20%3D%201.25)
So then if we replace we got:
![MRP= \frac{12.25\% -5.00\%}{1.25}=5.8 \%](https://tex.z-dn.net/?f=MRP%3D%20%5Cfrac%7B12.25%5C%25%20-5.00%5C%25%7D%7B1.25%7D%3D5.8%20%5C%25)
The shape of the block could be either a cylinder of a cone