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Salsk061 [2.6K]
2 years ago
8

Consider a portfolio comprised of four risky securities. Assume the economy has three states with varying probabilities of occur

rence. Which one of the following will guarantee that the portfolio variance will equal zero?A. The portfolio beta must be 1.0.B. The portfolio expected rate of return must be the same for each economic state.C. The portfolio risk premium must equal zero.D. There must be equal probabilities that the state of the economy will be a boom or a bust.
Business
1 answer:
olga nikolaevna [1]2 years ago
8 0

Answer:

B. The portfolio expected rate of return must be the same for each economic state.

Explanation:

Variance formula = sum of (probability x (r - mean)^2)

r= expected return

if the expected return would be same for each economic state then the mean would equal to expected return which ultimately will give variance zero ( as r-mean would be 0).

Hence the correct option is B. The portfolio expected rate of return must be the same for each economic state.

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charle [14.2K]

Answer:

40

Explanation:

According to Ricardian theory, any change in budgets deficits or surpluses should be completely offset by an equal change in private savings.

In this case, the original amount of private savings was 80, but since the budget deficit decreased by 40, then the private saving should also decrease by 40. The total private saving = 80 - 40 = 40

3 0
3 years ago
The following is not a distinguishing characteristic of a life estate.
CaHeK987 [17]

Answer:

The correct answer is letter "B": Holders of future interest own only a reversionary interest.

Explanation:

A life estate is a grant provided by the owner of a property to another individual for his or her lifetime. That individual -<em>called the life tenant</em>, is right to use the property at will bound only to waste. The distinguishing characteristics of the life estate imply that <em>holders of future own revisionary or remainder interest</em>, and that <em>the estate could be created by agreement from private parties or by law under prescribed scenarios</em>.

6 0
3 years ago
​Mid-Town Auto Parts Company uses the direct method to prepare its statement of cash flows. Refer to the following information r
Lera25 [3.4K]

Answer:

Collection from Customers =$487,000

Explanation:

Collection from Customers=account receivable beginning balance+sales revenue-account receivable ending balance

=97000+$519,000-$65,000

=$487,000

7 0
2 years ago
List three things you can do to improve job satisfaction
andrew-mc [135]

1. Respectful treatment of all employees at all levels

2. Trust between employees and senior management

3. Job security

Hope that helps :)

7 0
3 years ago
Read 2 more answers
In a country where only two goods are produced and consumed, the production and consumption of Good X results in external benefi
Fudgin [204]

Answer:

Would unregulated markets produce too much or too little of Good X and Good Y, compared to the efficient output levels for these products?

Explanation:

Good X: Too Little

Good Y: Too Much

8 0
3 years ago
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