"By diversifying your investments" is the way among the choices given in the question that you can <span>maintain a balance between high-risk and low-risk investments. The correct option among all the options that are given in the question is the first option or option "A". I hope the answer helps you.</span>
Answer:
4.95%
Explanation:
For computing the yield to maturity when expressed in real terms, first we have to find out the yield to maturity by applying the RATE formula that is shown in the attachment
Given that,
Present value = $989.40
Future value or Face value = $1,000
PMT = 1,000 × 7% ÷ 2 = $35
NPER = 10 years × 2 = 20 years
The formula is shown below:
= Rate(NPER;PMT;-PV;FV;type)
The present value come in negative
So, after solving this, the yield to maturity is 7.15%
Now in real terms, it would be
= 7.15% - 2.2%
= 4.95%
Answer: 41.90%
Explanation:
First calculate the risk free rate:
Required return = risk free rate + beta * (Market return - risk free rate)
28.95% = rf + 1.85 * (18% - rf)
28.95% = rf + 33.3% - 1.85rf
28.95% = -0.85rf + 33.3%
0.85rf = 33.3% - 28.95%
rf = 4.35%/0.85
rf = 5.12%
New required return;
Required return = risk free rate + beta * (Market return - risk free rate)
= 5.12% + 1.85 * (25% - 5.12%)
= 41.90%
Answer:
$33,630
Explanation:
Given that the company's collection history shows that 43% of credit sales are collected in month of sale and the remainder (57%) is collected in the following month then, in the month of January, Cash collections in January from December credit sales would be equivalent to 57% of December Credit sales. Using the actual figures,
Cash collections in January from December credit sales would be
= 57% * 59,000
= $33,630
D) By reducing expenses you increase margins which means there is more money available for stockholders
