1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
rusak2 [61]
3 years ago
7

Suppose two factors are identified for the U.S. economy: the growth rate of industrial production, IP, and the inflation rate, I

R. IP is expected to be 4% and IR 6%. A stock with a beta of 1 on IP and 0.7 on IT currently is expected to provide a rate of return of 12%. If industrial production actually grows by 5%, while the inflation rate turns out to be 8%, what will be your expected rate of return on the stock, given the new information about the industrial production rate and the inflation rate
Business
1 answer:
mash [69]3 years ago
7 0

Answer:

14.4%

Explanation:

Calculation for what will be your expected rate of return on the stock.

Expected rate of return on the stock=12% + 1(5%-4%) + .7(8%-6%)

Expected rate of return on the stock=12%+1(1%)+.7(2%)

Expected rate of return on the stock=12%+1%+1.4%

Expected rate of return on the stock=14.4%

Therefore your expected rate of return on the stock is 14.4%

You might be interested in
What do 'less is more 'mean in a relation to slide presentations
Anarel [89]
I'd take this to mean:

Having less words on a slide, and instead verbally speaking the information. This way the audience is engaged more, as they are hearing you give the information instead of you standing there awkwardly and having them read the information themselves.
5 0
3 years ago
Korey is planning to open a comic book store near his home. after completing a population survey for 3,520 homes in a 5 mile rad
astraxan [27]

Kids in grade school have a maximum percentage of 32 reasons that Option (d) is the correct answer.

<h3>why are the grade-school-aged kids surveyed?</h3>

Korey did the market analysis section of his business plan after conducting a population survey of 3,520 homes within a 5-mile radius.

He discovered that younger children who read comic books as children are more likely to read them as adults, resulting in a current and future client base.

For more information about the market analysis survey, refer below

brainly.com/question/3886071

6 0
2 years ago
Read 2 more answers
If the absolute value of the price elasticity of demand is greater than 1:
FrozenT [24]

Answer:

b. small percentage changes in the price will lead to much larger percentage changes in the quantity demanded.

Explanation:

Price elasticity of demand is a measure of how responsive is quantity demanded to change in price. Its formula is given by:

E_{D} = \frac{dQ}{Q}{\frac{P}{dP} =

= % Change in Quantity Demanded / % Change in Price

So when absolute value E_{D}  is greater than 1, a x percentage change in price will lead to larger than x percentage change in quantity demanded.

<u>Note</u>: Whether the percentage change in quantity demanded will be just a little or very much larger than percentage change in price will depend on how much E_{D} is larger than 1. But b is the still the best answer among the options.

7 0
3 years ago
Stadford Inc. is financed with 40 percent debt and 60 percent equity. This mixture of debt and equity is referred to as the firm
lesya692 [45]

Answer: Capital structure                            

Explanation: In simple words, capital structure refers to the proportion of different securities that an organisation uses as a combination to fund its operations. In other words, the amount of debt and equity in total capital in hand of the business is termed as capital structure.

Capital structure is of high importance to the investors as it directly impacts the liquidity and profitability of the organisation.

The ability of a company to bear its short term obligation is called liquidity and the ability to generate profit with given amount of resources is called profitability.

8 0
3 years ago
Julius asks Rachel if she would like to sell her boat. Rachel privately has no interest in selling her boat, and believes that J
ryzh [129]

Answer:

C) formed a valid contract because Rachel's outward expressions showed the formation of a contract.

Explanation:

A valid contract is a binding and enforceable agreement, where all parties are legally bound to perform the contract.

Probably the most important part of a contract is the existence of an offer and acceptance. Once a valid offer is accepted, it binds the parties into a valid contract.

In this case, Rachel accepted Julius´s offer to buy her boat, so an offer and acceptance exists.

5 0
3 years ago
Other questions:
  • Using a 14% cost of capital, calculate the net present value for each of the independent projects shown in the following table,
    13·1 answer
  • Handy hiking produces backpacks. In 2007, its highest and lowest production levels occurred in july and january, respectively. I
    11·1 answer
  • swift Oil Company is considering investing in a new oil well. It is expected that the oil well will increase annual revenues by
    6·1 answer
  • Overhead expenses are budgeted at $2,000 per month. Included in the $2,000 are $500 of monthly depreciation expense and $200 of
    11·1 answer
  • Moerdyk Corporation's bonds have a 15-year maturity, a 7.25% semiannual coupon, and a par value of $1,000. The going interest ra
    5·1 answer
  • The VP of Marketing directs you to begin looking at markets for Powerfully Fit's products: "Assuming that we focus on the desire
    12·1 answer
  • Consider an oligopoly industry whose firms have identical demand and cost conditions. If the firms decide to collude, then they
    7·1 answer
  • People commonly use credit cards, auto loans, home mortgages to finance their purchases *
    15·2 answers
  • The common stock of RMW Inc. is selling at $88 a share. It just paid a dividend of $4. Investors expect a return of 15 percent o
    6·1 answer
  • To accomplish u. s. objectives, the national security strategy guides the coordination of the instruments of national power whic
    9·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!