Your portfolio has three asset classes. U.S. government T-bills account for 45% of the portfolio, large-company stocks constitute another 40%, and small-company stocks make up the remaining 15%. If the expected returns are 3.8% for the T-bills, 12.3% for the large-company stocks, and 17.4% for the s...
Your portfolio has a beta of 1.19. The portfolio consists of 13 percent U.S. Treasury bills, 32 percent in stock A, and 55 percent in stock B. Stock A has a risk-level equivalent to that of the overall market. What is the beta of stock B?
Your non-profit agency has been given $20,000 to spend on health initiatives in the developingworld. You must spend the money on one of two competing projects.First, you can spend the entire $20,000 to build a well in a village of 200 people. The well will provide cleanwater and reduce eac...
Your mother has been working in a small bookstore for many
years. Her sales in the first year were $38,709, and her sales in
the last year were $78,866. If the sales grew at an average rate of
2.00 percent per year, how many years did your mother sell books in
Round the answ...
Your firm has the option of making an investment in new software that wil cost $130,000 today and is estimated to provide the savings shown in the table over5 years.
year savings estimate
should the firm make this investment if it requires a mi...
Your company will generate $45,000 in cash flow each year for the next nine years from a new information database. The computer system needed to set up the database costs $260,000. Assume you can borrow the money to buy the computer system at 8.25 percent annual interest.
1) If a corporation announces that it expects quarterly earnings to increase by 25% and it actually sees an increase of 22%, what should happen to the price of the corporation"s stock if the efficient markets hypothesis holds, everything else held constant?
2) Your best friend calls and g...
YouAcâ‚¬?cve observed the following returns on Crash-n-Burn ComputerAcâ‚¬?cs
stock over the past five years: 3 percent, -14 percent, 24 percent,
16 percent, and 18 percent.
Requirement 1: What was the arithmetic average
return on Crash-n-BurnAcâ‚...