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Digiron [165]
3 years ago
9

Suppose the rate of return on short-term government securities (perceived to be risk-free) is about 5%. Suppose also that the ex

pected rate of return required by the market for a portfolio with a beta of 1 is 14%. According to the capital asset pricing model: a. What is the expected rate of return on the market portfolio
Business
1 answer:
Natalka [10]3 years ago
7 0

Answer:

The expected rate of return on the market portfolio is 14%.

Explanation:

The expected rate of return on the market portfolio can be calculated using the following capital asset pricing model (CAPM) formula:

Er = Rf + B[E(Rm) - Rf] ...................... (1)

Where:

Er = Expected rate of return on the market portfolio = ?

Rf = Risk-free rate = 5%

B = Beta = 1

E(Rm) = Market expected rate of return = 14%

Substituting the values into equation (1), we have:

Er = 5 + 1[14 - 5]

Er = 5 + 1[9]

Er = 5 + 9

Er = 14%

Therefore, the expected rate of return on the market portfolio is 14%.

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You are the General Manager of a regional chemical company. In the course of producing your bulk chemicals, large amount of part
34kurt

Answer:

The answer is explained below

Explanation:

The companies board of directors as well as you would consider whether it is best to install the scubber system. When determining whether to install the scubber system both short and long term consequences are to be considered. If presently, the level of pollution is legal, you need to consider if in the future it would be legal? if the installation of the scubber system would affect the public relations of the company. After considering all this, it would be better to install because the pollution can lead to death, and the neighborhood can sue the company. Also the EPA regulations can be regulated.  

5 0
3 years ago
Which of the following is TRUE of debt securities? (A) Debt securities include preferred stocks. (B) Debt securities typically p
Bingel [31]

Answer:

The statement which is correct and true is that the debt securities usually pay interest for the fixed period or year. Therefore, the correct option is B.

Explanation:

Debt securities are the securities which refer to a debt instrument like CD (Certificate of deposit, preferred stock, corporate bond and municipal bond, it is sold or bought among the parties.

It is also called as the securities which are fixed income, therefore, the statement which is correct is that these securities pay interest for a fixed period.

6 0
3 years ago
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mixas84 [53]
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5 0
3 years ago
Read 2 more answers
Bennett Co. has a potential new project that is expected to generate annual revenues of $253,100, with variable costs of $140,00
Vlad [161]

Answer:

Hence, the annual operating cash flow is:  $44860

Explanation:

                                 Year 0    Year 1

Initital investment    

Inflows                                $253,100  

variable costs                       ($140,000)

fixed cost                             (53800)

Depreciton                         ($23,200)

Interest expense                 ($19,500)

Net cash inflows                   $16600 

Tax at 40%                           ($6640)

Net Cashinflows after tax      $9960

Add Depreciation                   $23,200  

Interest net of tax                   $11.700

Operating cashflows              $44860

Hence, the annual operating cash flow is: $44860

5 0
3 years ago
The Widner Company manufactures two products: Stainless Serving Spoons and Stainless Serving Forks. The costs and revenues are a
Lady bird [3.3K]

Answer:

Option D. 5,400 9,000

Explanation:

The computation for the number of units produced is shown below:

But before that first determined the following calculations

Particulars             Spoons                  Forks

Selling Price          $150.00               $88.00

Less:

Variable cost per unit    $80.00          $42.00

Contribution margin

per unit                         $70.00            $46.00

Machine hour per unit    5                               3

Contribution margin

per machine hour                $14.00            $15.33

As we can see that the contribution margin per machine hour of the fork is greater so it should be the first utilized

For 9,000 forks, total machine hours is

= 9,000 × 3

= 27,000

Now no of the spoons produced would be

= 27000 ÷ 5

= 5,400

4 0
3 years ago
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