The proportion of the optimal risky portfolio that should be invested in stock A is 0%.
Using this formula
Stock A optimal risky portfolio=[(Wa-RFR )×SDB²]-[(Wb-RFR)×SDA×SDB×CC] ÷ [(Wa-RFR )×SDB²+(Wb-RFR)SDA²]- [(Wa-RFR +Wb-RFR )×SDA×SDB×CC]
Where:
Stock A Expected Return (Wa) =16%
Stock A Standard Deviation (SDA)= 18.0%
Stock B Expected Return (Wb)= 12%
Stock B Standard Deviation(SDB) = 3%
Correlation Coefficient for Stock A and B (CC) = 0.50
Risk Free rate of return(RFR) = 10%
Let plug in the formula
Stock A optimal risky portfolio=[(.16-.10)×.03²]-[(.12-.10)×.18×.03×0.50]÷ [(.16-.10 )×.03²+(.12-.10)×.18²]- [(.16-.10 +.12-.10 )×.18×.03×0.50]
Stock A optimal risky portfolio=(0.000054-0.000054)÷(0.000702-0.000216)
Stock A optimal risky portfolio=0÷0.000486×100%
Stock A optimal risky portfolio=0%
Inconclusion the proportion of the optimal risky portfolio that should be invested in stock A is 0%.
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Answer:
The correct answer is stage of development.
Explanation:
Leadership is a process, not a punctual act. A person does not go from having little impact on others to having a great influence from one day to another, it takes an evolution and especially the necessary step through the 4 stages of leadership.
When we analyze the different types of leaders that have an impact, we realize what kind of steps they have taken to get there, what different phases they have had to go through and what their evolution has been. This model helps us to contextualize the place in which a person is and what the next steps would be to improve their leadership capacity.
Stage I. Depend on other people
Stage II: Individual and independent contribution
Stage III Contribution through others
Stage IV: Leadership through a vision
Answer:
Stock value per share = $136.8
Explanation:
The value of a firm can be determined using the free cash flow and the Discount cash flow model.
The discounted cash flow model values a firm as the the sum of the present values of the future cash flows generated by the assets of the firm discounted at an appropriate required rate of return. This rate of return (discount rate)is called Weighted average cost of capital (WACC)
The weighted Average cost of Capital is the average cost of capital for the different sources of long-term capital available to a firm weighted according to the proportion each source of finance bears to the total capital in the pool.
Free cash flow to the Firm ( FCFF) is the cash flow from operations minus capital expenditures. It is the cash flow available to all providers of capital after all investments in non-current assets and working capital have been made.
Value of a firm = FCFF (1+g)/(WACC-g)
g- growth rate
Value of Banco = 150 × (1+0.04)/(0.0685- 0.04)
=5473.684211
Value per stock = (Value of the firm - Value of Debt)/ No of stock units
= <u>5473.68 - 0</u>
40 million units
Stock value per share = $136.8
The microeconomic factors that are important to consider in business is competition, the supply and demand, elasticity of the goods and similar variables. Depending on the business, each has factor has a unique impact which can either help or ruin the business.Thank you for your question. Please don't hesitate to ask in Brainly your queries.
Answer:
B) Developing countries are using less oil because of substantial investments in renewable energy.
Explanation:
Developing countries using less oil by investing in renewable sources of energy will weaken the argument as this directly contradicts the basis of James' argument. Since there is less demand from developing countries for oil, the argument that their demand pushes the prices high falls apart and hence is now a weakened argument.
Hope that helps.
