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Bogdan [553]
3 years ago
15

Over a 20-year period an investment of $1,000 in common stocks returned an average of 11% in nominal terms and 4% in real terms.

At the end of the 20 years, the portfolio value was:________
a. $3,679.19 in real terms.
b. $1,800 in real terms.
c. $8,062.31 in nominal terms.
d. $7,870.59 in nominal terms.
Business
1 answer:
Travka [436]3 years ago
6 0

Answer:

c. $8,062.31 in nominal terms.

Explanation:

The portfolio value required which is at the end of 20 years is the future value of the amount invested initially($1000) , compounded at the nominal rate of return 11% per year as shown below:

FV=PV*(1+nominal interest rate)^n

PV=present value=initial invested=$1000

nominal interest rate=11%

n=time horizon of the investment=20 years

FV=$1000*(1+11%)^20= 8,062.31  

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Snowcat [4.5K]

Answer:

Self nurturing

Explanation:

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Self nurturing entrepreneurs are those entrepreneurs who have immense self belief and who back their views and business ideas.

In the given case, Wilson has learnt from his experiences, the importance of organizational culture and what it stands for. Here Wilson depicts the trait of learning along on his own and being self taught. This displays the attribute of self nurturing.

6 0
3 years ago
National Advertising just paid a dividend of D0 = $0.75 per share, and that dividend is expected to grow at a constant rate of 6
Temka [501]

Answer:

$8.78

Explanation:

National advertising made dividend payment of $0.75 per share

The dividend is expected to grow at a constant rate of 6.50%

= 6.50/100

= 0.065

The company beta is 1.85

The required return on the market is 10.50%

The risk free rate is 4.50%

The first step is to calculate the rate of return using the CAMP model

R = Risk free rate+beta(market return-risk free rate)

= 4.50%+1.85(10.50%-4.50%)

= 4.50%+1.85×6%

= 4.50%+11.1

= 15.6

Required rate of return= 15.6

Therefore the current stock price can be calculated as follows

Po= Do(1+g)/(r-g)

Where Do= 0.75, g= 0.065, r= 15.6

Po= 0.75(1+0.065)/(0.156-0.065)

Po= 0.75(1.065)/0.091

Po= 0.7987/0.091

Po= $8.78

Hence the company current stock price is $8.78

3 0
3 years ago
Suppose that an economy's labor productivity fell by 3 percent and its total worker-hours remained constant between year 1 and y
11111nata11111 [884]

Answer: 1. real GDP declined.

Explanation:

If labor productivity fell yet the workforce did not increase, that means that for Years 1 and 2, workers were producing less than they were producing before because the same number of people were producing.

This means that the amount of goods produced in the country would reduce and therefore GDP would reduce as well as GDP is the amount of goods and services produced in a country. If labor productivity had fallen yet the work-hours had increased, the increase in worker hours would have made up for the loss of labor productivity.

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3 years ago
In order to have competition in a market economy, there must be at least _____ or more sellers acting independently in a particu
NISA [10]

In order to have competition in a market economy, there must be at least 2 or more sellers acting independently in a particular market.

<h3>What is competition in a market economy?</h3>

competition in a market economy serves as one that  allows multiple individuals  as well as  businesses to use resources efficiently  as well as producing  the cheapest products  without compromising  quality.

It should be noted that In order to have competition in a market economy, there must be at least 2 or more sellers acting independently in a particular market.

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8 0
1 year ago
Dave has forty acres where he grows corn and soybeans. he also has five milk cows and some chickens. dave sells organic milk and
laila [671]

Answer:

B) chapter 12

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