Interest earned on a savings account is ____

Assume that you hold a well-diversified portfolio that has an expected return of 11.0% and a beta of 1.20. The total value of yo

diamong [38]

Answer:

hope this helps

Assume that you hold a well-diversified portfolio that has an expected return of 11.0% and a beta of 1.20. You are in the process of buying 1,000 shares of Alpha Corp at $10 a share and adding it to your portfolio. Alpha has an expected return of 21.5% and a beta of 1.70. The total value of your current portfolio is $90,000. What will the expected return and beta on the portfolio be after the purchase of the Alpha stock? Do not round your intermediate calculations.

Old portfolio return

11.0%

Old portfolio beta

1.20

New stock return

21.5%

New stock beta

1.70

% of portfolio in new stock = $ in New / ($ in old + $ in new) = $10,000/$100,000=

10%

New expected portfolio return = rp = 0.1 × 21.5% + 0.9 × 11% =

12.05%

New expected portfolio beta = bp = 0.1 × 1.70 + 0.9 × 1.20 =

1.25

Explanation:

7 0

2 years ago

A judge requires Harry to make a payment to Sally. The judge says that Harry can pay her either $10,000 today or $12,000 two yea

Stells [14]

Answer:

d. 9 percent

Explanation:

After 2 years the value of $10,000 at present time =

$10,000 * (1 + x / 100)^2 = $12,000

(1 + x / 100)^2 = 12,00 / 10,000

(1 + x / 100)^2 = 1.2

The square root of 1.2 is 1.0954

(1 + x / 100) = 1.0954

x = 9.54

9%( Approximately.)

7 0

3 years ago

A country produces only bananas and robots. If it produced only bananas with all its available resources, it could make 60 milli

Levart [38]

It should be noted that in the PPC, the downward sloping line 'ab' is the production possibility curve.

<h3>How to illustrate the information?</h3>

In the diagram, since point 'A' falls on the PPC itself, it represents the full employment of resources. Point 'A' represents the combination of 30 million bananas and 10 million robots.

Opportunity cost producing a robot = Total bananas possible / Total robots possible

Opportunity cost producing a robot =60/20

Opportunity cost producing a robot = 3 bananas

The area outside PPC represents the unattainable combinations of two goods.

During the recession, the resources are inefficiently used and the production combination is represented by point 'B' which falls below PPC When the production technology improves only for one good and not for the other, the PPC rotates

Marginal opportunity cost of a robot = 80 million bananas / 10 million robots

The marginal opportunity cost of a robot = 8 bananas

Opportunity cost of 2 million robots = 8 bananas × 2 million

The opportunity cost of 2 million robots will be 16 million bananas.

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8 0

2 years ago

f the steps are small, a step-variable cost may be approximated using a ______ cost function without significant loss in accurac

posledela

If the steps are small, a step-variable cost may be approximated using a Variable cost function without significant loss in accuracy.

<h3>Variable cost function</h3>

An expense for the company that varies according to how much is produced or sold is called a variable cost.
Depending on a company's production or sales volume, variable costs grow or fall. They climb as production rises and reduce as production declines.
It is a production cost whose level fluctuates in response to shifts in a business's manufacturing activities.
For instance, the raw materials required to make a product's components are regarded as variable costs because they frequently change depending on the volume of units produced.
The total variable cost curve depicts the relationship between total variable cost and the volume of output produced graphically.

To learn more about the Variable cost function refer to:

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7 0

2 years ago

In 1985, Alice paid $20,000 for an option to purchase ten acres of land. By paying the $20,000, she bought the right to buy the

hram777 [196]

Answer:

The answer is: Yes

Explanation:

The money Alice paid in 1985 ($20,000) is considered a sunk cost.

A sunk cost is money already spent that cannot be recovered.

So if Alice decides to buy the land or not, she will not recover a cent from the $20,000 she paid before.

Since the current price of the land is $110,000 and Alice can purchase it for $100,000, then she should buy it. She is going to earn a $10,000 profit.

8 0

3 years ago

Interest earned on a savings account is _____.