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anzhelika [568]
2 years ago
10

Suppose the risk free interest rate is 3% and the return on the market portfolio of stocks is 8%. The alpha company has beta of

1.5 has beta of .75 . Your brother-in-law tells you that next year Alpha will return 11% and Zulu will return 6%. If you believe your brother-in-law you should
Business
1 answer:
RideAnS [48]2 years ago
8 0
My brother-in-law owes you 3038$ which is 11%
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The price of gas increased, which means_<br> people will buy gas in the future.<br> more<br> fewer
oee [108]

Answer:

Fewer

Explanation:

A side effect of high gas prices is that discretionary spending of consumers goes down as they spend relatively more of their income on gasoline. Higher prices also mean that shoppers will tend to drive less - including to places like to mall or shopping center.

7 0
3 years ago
Read 2 more answers
Which theory would most likely explain why a commercial bank, which usually focuses on short-term securities, would switch to lo
den301095 [7]

Answer:

preferred habitat

Explanation:

According to the preferred habitat theory, if the expected returns from investment of a particular investment maturity is large enough, investors would shift from their preferred maturities.

In this question, there is a shift from the preferred maturity (short-term securities) to a long-term securities when interest rate changes

The pure expectations theory assumes that bonds of any maturity are perfect substitutes for each other. For example, if an investor buys a 10 year bond and holds it for 1 year, the return is the same as buying a 1 year bond. The theory also assumes that risk premium does not exist and a security only earns its risk free rate

Liquidity premium theory states that risk premium increases with the maturity of a bond. The theory predicts that the yield curve is upward sloping due to liquidity premium

According to the segmented market theory, each bond maturity segment can be thought of as a segment market in which yield are a function of the demand and supply for funds in that maturity.

5 0
3 years ago
The Electrocomp Corporation manufactures two electrical products: air conditioners and large fans. The assembly process for each
zzz [600]

Answer:

40 air conditioner and 60 fans yield a 1,900 dollar profit

Explanation:

Maximize: 26x_1+15x_2\\$Subject to:\\3x_1+ 2x_2 =240\\2x_1+x_2 =120

We apply this constrain on excel solver tool.

                     Wiring  Drilling    Profit per unit   Total Profit

AC  40 units 120  80            25                  1000

Fan 60 units 120  60            15                  <u> 900 </u>

  240        140  1900                 1,900

8 0
3 years ago
Adonis Corporation issued 10-year, 11% bonds with a par value of $270,000. Interest is paid semiannually. The market rate on the
shutvik [7]

Answer:

e) Adonis must pay $270,000 at maturity plus 20 interest payments of $14,850 each.

Explanation:

Based on this information,Adonis Corporation is issuing a coupon paying bond.

  • The $286,827 that they receive is the market price/ market value of the bond.
  • The duration of the bond = 10 years, however, since the coupons are paid semiannually, there will be 10*2 = 20 payments in total.
  • Semi annual coupon payment; PMT = (11%/2) *270,000 = $14,850
  • The $270,000 is the face value of the bond which must be repaid at the end of the life of this bond.
  • <em>Therefore, Adonis must pay $270,000 at maturity plus 20 interest payments of $14,850 each.</em>
3 0
3 years ago
A product found in homes built before 1978 is harmful to children. It can lead to birth defects and is generally hazardous. It s
BabaBlast [244]

Answer:

Asbestos

Explanation:

This environmental hazard is asbestos. Exposure to asbestos especially for a long term period is very detrimental to health. It's fibres can be easily inhaled to the lungs which is dangerous and can cause fibrotic lung disease and also lung cancer. It can lead to defects in birth when inhaled by a pregnant woman and many other health problems. During sales of property it is very important that such hazard is disclosed to the other party.

4 0
3 years ago
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