A stock has an expected return of 13. 24 percent, the risk-free rate is 4. 4 percent, and the market risk premium is 8. 98 percent. 0.75 is the stock's beta.
Calculate the beta for stock using the CAPM approach as follows:
Cost of common stock = Risk-free rate + Beta × Market risk premium
13% 7% + Beta x8%
13% 7% Beta × 8%
6% = Beta x8%
6% 8% Beta = =
=0.75
Therefore, the beta for stock using the CAPM approach is 0.75.
Market risk is the potential for loss to individuals or other companies as a result of factors that affect the overall performance of an investment in financial markets.
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Answer:
True (T)
Explanation:
In the given statement, it can be inferred that the membership of segments have a common goals. This means that the constituents of the segments would definitely give either positive or negative comments in reference to the marketing mixes and the outcomes that are created by the marketing mixes. Therefore, the given statement is true.
Answer: (D)
Explanation: Reports and financial statements prepared by accountants are useful tools to evaluate an organisation's liquidity,solvency and stability. It helps the general public and other stakeholders to get the required data and information needed for decision making.
The inflationary trends shows the relationship between demand and supply in an economy which will help management to implement the necessary steps that will enhance it's operations.
The balance of trade between 2 countries provides necessary details for decision makers on when and how to improve or manage exports and imports.
Answer:
The answer: ''In other words, it examines how actions and events involving top executives, firms and industries influence a firm's success or failure'' is correct.
Explanation:
To begin with, in the field of business the managers tend to be very agressive and competitive in order to set their companies in the top of the industry and therefore to obtain the maximun profits as possible.
To continue, the strategic management group wonder themself why do some firms outperform other firms and the answer to that question has many factors that influece the situation where that happens, in other words, it is normal that many companies with less resources, such as money or human knowledge, tend to give a worst performance that other companies that count with executives with huge experience or better economic situations in the industry. Moreover, it is known that the companies with a manager that knows how to manage the business with the resources it has and how to comprehend the situation where it heads will perform at a higher level than the other.
