Answer: Option B
Explanation: In simple words, capital market is that market in which securities that are long term in nature are sold and purchased. The maturity period of such securities is generally more than one year.
These, markets transact all types of securities whether it is equity or debt, but it has to be long term in nature.
Hence, from the above we can conclude that the right answer is Option B.
Answer:
option (a) $98,878
Explanation:
Given:
Annuity = $13,000
Time = 15 years
Rate = 10%
now,
Present value = Annuity × ( Annuity factor for 15 year and rate 10% )
from the table the annuity factor can be found out by using the table provided in the question
pointing to the value common in the row of 15 and column of 10% i.e (7.606)
thus,
or
Present value = $13,000 × ( 7.606 )
or
Present value = $98,878
hence the correct answer is option (a) $98,878
Answer:
20%
Explanation:
300÷360×100 =20%. hence 300×100=30000÷100=20%
Answer:
(a) 12.75%
Explanation:
Given that,
Beta = 1.5
Risk-free rate = 4.5 percent
Expected return on market portfolio = 10 percent
Here, we are using CAPM:
(a) Expected rate of return for Acer common stock:
= Risk free rate + beta (Expected return on market Portfolio - Risk free rate)
= 4.5% + [1.5 (10% - 4.5%)]
= 0.045 + (1.5 × 0.055)
= 0.045 + 0.0825
= 0.1275 or 12.75%
(b) This rate is known as the fair rate which compensates the holder or investor for assuming the risk associated with it and for the time value of money.
