Ask question

Ask question

All categories

3 years ago

11

If we compare the betas of various investment opportunities, why do the assets that have higher betas also have higher average e

xpected rates of return

1 answer:

tester [92]3 years ago

6 0

Answer:

Because they are more riskier and have higher rates of return.

Explanation:

You might be interested in

Which of the following is true if the volume of sales increases (within a relevant range)? total variable cost increases total f

Alex_Xolod [135]

Answer:

total variable cost increases

Explanation:

Variable cost refers to the expenses that change with production volume. There is a direct relationship between variable costs and the level of production. An increase in the output level will result in a rise in variable costs. For sales volume to increase, the output level must have been high.

A high production level is necessary to support a high sales volume. Examples of variable costs are packaging and raw materials. A high output level will require the use of a large volume of raw materials, hence higher costs. Fixed cost contrast variable costs, as they do not change with varying output.

3 0

3 years ago

Mountain Ski Corp. was set up to take large risks and is willing to take the greatest risk possible. Lakeway Train Co. is more t

SpyIntel [72]

Answer:

a-1)

- Project A = 0.70

- Project B = 0.64

- Project C = 0.81

- Project D = 1.29

a-2) Mountain Ski Corp. should choose projects D and C

b) Lakeway Train Co. should choose project B

Explanation:

It’s needed to calculate the coefficient of variation for each project

Formula: CV=σ/μ

Where:

σ = standard deviation

μ = mean

The coefficient of variation (CV) is a ratio that compares the standard deviation with the mean of a project`s return, indicating the volatility and risk of it. The lower its value the better risk-return trade-off. So, a company set up to take large risks such as Mountain Ski Corp. would choose projects with high CV (Projects D and C), and a risk-averse company such as Lakeway Train Co. would choose projects with low CV (Project B).

5 0

3 years ago

Setting and achieving goals is essential to success.<br><br> a. True<br> b. False

joja [24]

Answer: True

Explanation:

The statement that "Setting and achieving goals is essential to success" is true.

When we set goals, it gives us a motivation for the short term and also a long term vision. Setting goals doesn't allow us to deviate from whatever we want to achieve. Our time and resources are dedicated towards achieving that set goal.

5 0

3 years ago

The following information was taken from the segmented income statement of Restin, Inc., and the company's three divisions:

Rainbow [258]

Answer:

d. $75,000

Explanation:

total Los Angeles Bay Area Central Valley

Revenues $750,000 $200,000 $235,000 $325,000

Variable exp. $410,000 $110,000 $120,000 $180,000

Controllable $210,000 $65,000 $75,000 $70,000

<u>fixed expenses </u>

controllable $130,000 $25,000 $40,000 <u>$75,000</u>

profit margin

Noncontrollable fixed expenses and common fixed expenses are not included in the calculation of individual controllable profit margin.

7 0

3 years ago

David Harbert recently started a business. During the first few days of operation, Mr. Harbert transferred cash from his persona

masya89 [10]

Answer:

5

Explanation:

A reporting entity is any entity in men or organizations that depends on the financial report produced by an organization for an understanding of the financial performances and position for the purpose of decision making. This can be investors and other stakeholders in the business.

In the scenario given , the relative parties that will rely of the financial report are

David Herbert as the Entrepreneur , Herbert Enterprises which prepare the report ,George , Herbert's brother an investor , First federal bank , a loan provider and City properties.

8 0

3 years ago