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Returns and Standard Deviations - Consider the following information: Rate of Return if State Occurs State of Economy Pobability of state of Economy Stock A Stock B Stock C Boom ...
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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...
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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? ...
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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...
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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 her bookstore? Round the answ...
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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 1 $35,000 2 50,000 3 45,000 4 25,000 5 15,000 should the firm make this investment if it requires a mi...
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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. ...
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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...
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Your aunt offers you a choice of $20,000 in 50 years or $45 today. If money is discounted at 13 percent, which should you choose? ...
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YouAc€?cve observed the following returns on Crash-n-Burn ComputerAc€?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‚...

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