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sattari [20]
3 years ago
7

Which one of the following statements is correct concerning the expected rate of return on an individual stock given various sta

tes of the economy?
a. The expected return is an arithmetic average of the individual returns for each state of the economy.
b. As long as the total probabilities of the economic states equal 100%, then the expected return on the stock is a geometric average of the expected returns for each economic state.
c. The expected return is equal to the summation of the values computed by dividing the expected return for each economic state by the probability of the state.
d. The expected return is a geometric average where the probabilities of the economic states are used as the exponential powers.
e. The expected return is a weighted average of the returns where the probabilities of the economic states are used as the weights.
Business
1 answer:
tekilochka [14]3 years ago
8 0

Answer: e. The expected return is a weighted average of the returns where the probabilities of the economic states are used as the weights.

Explanation:

When calculating the expected return of a stock given the probabilities that different economic states would occur and the returns of the stock should those states occur, we use the probabilities as weights to get the weighted average of the returns given. This is the expected return.

Formula looks like this:

Expected return = (Probability that economy is good * return if economy is good) + (Probability that economy is average * return if economy is average) + (Probability that economy is poor * return if economy is poor)

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Answer:A

Explanation:

The optimal value will always remain the same. It is because profit is a difference between total revenue and total cost.

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Assume that a purely competitive firm has the following schedule of average and marginal costs:
tia_tia [17]

Answer:

a) At a price $55, the firm would produce 3 units of output.

At a price of $120, the firm would produce 6 units of output.

At a price of $200, the firm would produce 7 units of output.

The rule is Price = Marginal Cost for a competitive firm

b) The per-unit economic profit (or loss) is calculated by subtracting ATC at a particular level of output from the product price. This per-unit economic profit is then multiplied by the number of units of output to determine the economic profit for the competitive firm.

i) At the product price of $200, the average total costs are $146 , so per-unit economic profit is $54 . Multiplying this amount by the number of units of output results in an economic profit of $378 .

Explanation:

At P = 200, output produced is 7 units

ATC is $146

Per-unit economic profit = 200 - 146 = $54

Hence, Total economic profit = $54 x 7 = $378

ii) At the product price of $120, the average total costs are $140 , so per-unit economic losses are $ -20. Multiplying this amount by the number of units of output results in an economic loss of $-100.

Explanation: At P = 20, output produced will be 5 units. 6th unit will not be produced as it will result in even greater loss.

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How to find total assets on a trial balance
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Locate the company's total assets on the balance sheet for the period. Total all liabilities, which should be a separate listing on the balance sheet. Locate total shareholder's equity and add the number to total liabilities. Total assets will equal the sum of liabilities and total equity.

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A manager is trying to decide whether to buy one machine or two. If only one is purchased and demand proves to be excessive, the
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Now if we move back on decision tree where two machines are bought and if demand is low then payoff is 0.2 * 80000 + 0.8 * 160000 for high demand = 16000 + 128000 = $144000.

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In case of event 1 we can see the benefits can be either $144000 or $148000 calculated above.

Se we see the best outcome is when the manager subcontracts and the benefit is $160000.

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