Answer:
c. equilibrium price and equilibrium quantity both to increase
Explanation:
If demand for a good increases, the equilibrium price will increase too, because consumers will be willing to purchase the good at higher prices. Besides, suppliers will try to take advantage of this situation by producing more of the same good, increasing the equilibrium quantity as well.
Answer:
Project B, which is of below-average risk and has a return of 8.5%.
Explanation:
E is the only one that should be accepted. A and B both have returns that are too low considering their risk and should be rejected (which means C and d is out as an answer as well.
Answer:
Security D
Explanation:
Fair rate of Return =
where B = Beta, which is the degree of responsiveness of security return to market return
= Risk Free Rate of return
= Return on market portfolio
Risk premium which is, 10 - 4 = 6 %
Thus, for security A = 4 + 0.85 × 6 = 9.1%
for security B = 4 + 0.75 × 6= 8.5%
for security C = 4 + 1.2 × 6 = 11.2%
for security D = 4 + 1.35 × 6 = 12.1%
for security E = 4 + 0.5 × 6 = 7%
Expected returns as given
for A = 7%
for B = 9%
for C = 9.5%
for D = 12.1%
for E = 14%
As is evident, the fair and expected return for stock D is the same i.e 12.1%. Hence, the investor would be indifferent in that case whether to buy, sell or hold such a stock.
Answer:
Determine the minimum amount for which the non-cash assets must have been sold, in order for quincy to receive some cash from the liquidation:
Total non-cash assets = 300,000
Less: Balance needed from non-cash assets = 95,000
($90,000 - $15,000 - $170,000)
Adjusted non-cash assets = 205,000
Less: Liquidation expenses = 15,000
Balance of non-cash assets = 190,000
Hence, the the minimum amount for which the non-cash assets must have been sold, in order for quincy to receive some cash from the liquidation would be any amount in excess of $190,000.