according to the capital asset pricing model capm what is the expected market retrun on a security of 9.5% a stock beta of 1.2 and a risk free interest rate of 2%

Answers

Answer 1

Answer:

Expected market return on a security is 9.92 %.

Explanation:

The Capital Asset Pricing Model (CAPM) is used to calculate the cost of equity for a firm as

Cost of Equity = Return on Risk Free Security + Beta × Risk Premium

Where,

Risk Premium = Return on Market Portfolio - Return on Risk Free Security

                       = Rm - 0.02.

Thus market return (Rm) can be determined as,

0.095 = 1.20 × (Rm - 0.02)

0.095 = 1.20 Rm - 0.024

1.20 Rm = 0.119

Rm = 0.0992 or 9.92 %


Related Questions

What is the expected rate of return for a stock that has a beta of 1 if the expected return on the market is 13%?A. 15%.B. More than 15%.C. Cannot be determined without the risk-free rate.

Answers

Answer:

13%

Explanation:

If the beta is one, it means that the stock moves in line with the market, so expected return of the stock would be = 1 x 13% = 13%

A critical success factor in project management is to: Group of answer choices Say "no" to all requests because they add to scope creep. Use throwaway prototyping. Use a CASE tool to delineate requirements from work tasks. Start with a realistic assessment of the work that needs to be done. Hire an outside project management consulting group.

Answers

Answer: Start with a realistic assessment of the work that needs to be done.

Explanation:

Project management involves the planning, organization and the effective use of the resources that are available in order to achieve the project goals.

A critical success factor in project management is to start with a realistic assessment of the work that needs to be done.

(Scenario: A Monopolist) A monopolist faces a demand curve given by P = 20 Q and has total costs given by TC = Q2. By using a bit of calculus, you should be able to determine that the firm's marginal revenue is MR = 20 2Q and its marginal cost is MC = 2Q. What is its profit-maximizing output level?

Answers

Answer:

Profit-maximizing output level = 5 unit

Explanation:

Given:

P = 20 - Q

TC = 2Q

MR = 20 - 2Q

MC = 2Q

Find:

Profit-maximizing output level

Computation:

Profit-maximizing output level.

MR = MC

20 - 2Q = 2Q

Q = 5

Profit-maximizing output level = 5 unit

A description of an economy's share of households reflecting different income levels is called income _________.

Answers

Answer: Income distribution

Explanation:

Income distribution is a description of an economy's share of households reflecting different income levels.

Income distribution helps to show how the gross domestic product of an economy is being distributed among the people in the country. Income distribution is also used to know the number of poor or wealthy people in the society.

A practical benefit of ________________is that it requires little in the way of resources which can be helpful for organizations that donât have a dedicated content team, but that still want to position themselves as trusted advisors in their industry.

a. Auto-Generated Content
b. Created Content
c. Promoted Content
d. Amplified Content
e. Curated Content
f. Verified Content

Answers

Answer:

Option e (Curated content) is the correct choice.

Explanation:

Curated content becomes material from outside outlets that people communicate throughout your community on your platform, blog as well as social media platforms beyond your business. This should have been important and beneficial to every intended market, and prove you understand the importance different businesses contribute to your business or topics of concern.

The other choices don't apply to particular circumstances. Because then the choice is indeed the right one.

Which of the following is an example of the calculation of a predetermined overhead rate? A) Estimated overhead divided by estimated direct labor dollars B) Estimated overhead divided by actual direct labor hours C) Actual units produced divided by estimated overhead D) Estimated direct labor hours divided by estimated overhead

Answers

Answer:

A) Estimated overhead divided by estimated direct labor dollars

Explanation:

Predetermined overhead rate is used to apply estimated manufacturing overhead cost to the cost of products or labor for a certain period allocated for reporting. It is usually calculated at the beginning of a certain period and it is also necessary for computing the actual manufacturing overhead cost at the end of the fiscal year.

The predetermined overhead rate can be calculated by dividing the estimated manufacturing overhead by the estimated direct labor dollars or estimated direct labor hours or estimated machine hours for that period. The calculation is based on estimated values, not the actual cost

You own a house that you rent for $1,400 per month. The maintenance expenses on the house average $260 per month. The house cost $231,000 when you purchased it 4 years ago. A recent appraisal on the house valued it at $253,000. If you sell the house you will incur $20,240 in real estate fees. The annual property taxes are $3,100. You are deciding whether to sell the house or convert it for your own use as a professional office. What value should you place on this house when analyzing the option of using it as a professional office

Answers

Answer:

$232,760

Explanation:

you must first determine the market value of your house = appraisal value - sales expenses = $253,000 - $20,240 = $232,760

the market value of the house is your opportunity cost of using the house as an office.

opportunity costs are the extra costs or benefits lost resulting from choosing one investment or activity over another alternative.

How managers plan significant investments in projects that have long term implications such as purchasing new equipment or introducing new products is called

Answers

The answer is Capital Budgeting.

Jones Manufacturing needs $450,000 to build a new plant. It must also spend $200,000 on new equipment for the plant. Both of these needs are examples of

Answers

Answer: long term financing needs

Explanation:

Long-term financing are the capital requirements for an organization for a period of five or more years. Long term financing needs are utilized for the capital expenditures in fixed assets such as the land and building, plant and machinery etc.

Therefore, Jones Manufacturing needs $450,000 to build a new plant. It must also spend $200,000 on new equipment for the plant. Both of these needs are examples of long term financing needs.

The production strategy of a firm using a global strategy would likely entail A. A narrow selection of models and styles with each model/style focused on identified international market niches. B. Locating plants on the basis of maximum competitive advantage—in countries where manufacturing costs can be kept low or close to major markets to economize on shipping costs or use of a few world-scale plants to capture maximum scale economies and experience curve effects, as most appropriate. C. Producing the various products at plants scattered around the world. D. Producing a broad product line (many models and varieties) so that buyers in each target national market would be able to select the item that best met their individual needs. E. Creating a different product lineup for each major area of the world (Europe, North American, Latin America, and the Asian Pacific).

Answers

Answer:

The correct answer is the option B: Locating plants on the basis of maximum competitive advantage, in countries where manufacturing costs can be kept low or close to major markets to economize on shipping costs or use of few world-scale plants to capture maximun scale economies and experience curve effects, as most appropiate.

Explanation:

To begin with, the concept known as "Global Strategy" in economics and business terms, refers to the type of method that a company uses in order to accomplish the global penetration of its product so that the sales of the business starts to rise and the profits increases as well. The major bases in this type of strategy are in the fact of finding the places where will be more opmital to produce due to the factors that will influece the production and the plant as a whole. Therefore that in order to succeded with this movement, the company will have to reach economies of scale in those places.

For a sales-type lease:_______
a) the gross profit will be lower if the residual value is unguaranteed
b) the gross profit will be higher if the residual value is guaranteed
c) the present value of the unguaranteed residual value is added
d) to determine the cost of goods sold

Answers

Answer:

no option is correct (I assume options C and D were one option only)

Explanation:

On a sales type lease, the gross profit generated by the lease is determined in a similar way that net present value of a project is determined.

You must first calculate the present value of the lease payments that should be received using the company's discount rate, and then subtract the asset's value. If the present value of the future lease payments is higher than the present value of the asset, then you should have a gross profit.

The gross profit is not affected whether the asset has or doesn't have a guaranteed residual value.

Maple Leaf, Inc., a television manufacturer, would like to reduce its inventory. To this end, you are asked by the operations manager to assess its inventory level. You have the following information on average inventories from last year's financial statement:

Raw materials $2,500,000
Work-in-process $1,000,000
Finished goods $800,000

In addition, the cost of goods sold last year (50 weeks) was $12 million. What was the inventory turnover?

a. Less than or equal to 2
b. Greater than 2 but less than 3
c. Greater than 3 but less than 4
d. Greater than 4

Answers

Answer:

Maple Leaf, Inc.

Inventory Turnover:

b. Greater than 2 but less than 3

Explanation:

a) Data and Calculations:

1) Average inventories:

Raw materials     $2,500,000

Work-in-process  $1,000,000

Finished goods      $800,000

Total average inventory   $4,300,000

Cost of goods sold = $12,000,000

Inventory Turnover = Cost of goods sold/Average Inventory

= $12,000,000/$4,300,000

= 2.79 times

2) Inventory turnover is a financial ratio that shows the number of times in a year that inventory has been sold by Maple Leaf, Inc.  When it divides the number of days, say 360 days in a year, the ratio that comes out shows the number of days it takes Maple to sell its inventories.

To arrive at net cash provided by operating activities, it is necessary to report revenues and expenses on a cash basis. This is done by

Answers

Answer:

Indirect method

Explanation:

The indirect method reconciles the Operating income to the Operating cash flow by adjusting the Operating Income by (1) Non-cash items previously added or deducted from Operating Income and (2) adjusting for changes in working capital items.

Let's not do business with AVC Real Estate Company; they discount their commissions" is an example of what?a) Price fixingb) Boycottc) Market allocationd) Tying agreement

Answers

Answer:

Boycott

Explanation:

Unit 1 National Brokerage was tough at first for me too

) for correct answers, how will your scores be affected with each submission you use up? select all that apply. after a few submissions you will get zero points. you will not lose any points for correct answers even if you use all allowed submissions. after a few submissions, you will start to lose a percentage of the points for that question. you will not lose any points for the first few submissions. (h) how much are the prelab, inlab, and postlab parts worth? prelab: % inlab: % postlab % (i) as a rule, the prelab, inlab, and postlab are due at a particular time each week. fill in the appropriate answer in each of the boxes below. prelab: inlab: postlab:

Answers

Answer:

The answer is "You won't lose any answers even if you're using all approved entries".

Explanation:

In the given question there is some mistake in the choices. so, we define only the correct answer.

The above-given choices describe the  Its application may also apply to the reports produced so that it can make the quality of the documentation acceptable.  

It is just an act that offers someone a document, a proposal, a written document, etc. because it can be considered or accepted. Its state of obedience action of acknowledging another person's authority or power.

The correct option  is You won't lose any answers even if you're using all approved entries.

The following information should be considered:

 The given choices represent the  Its application may also apply to the reports generated so that it can make the quality of the documentation acceptable.   It is just an act that offers someone the document, a proposal, a written document, etc. since it can be accepted.

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An alternative approach to recording unearned revenue would be to ______ when cash is collected from a customer in advance of providing goods and services.

Answers

Answer:

The correct response will be "Credit sales revenue".

Explanation:

Net credit sales would be costs that come by someone with an individual or attribute which enables on account receivables, minus the cost gross sales as well as sales pension contributions. Net loan transactions don't include any transactions about which money changes hands in cashback rewards.

So that the above would be the correct approach.

Let's say that you're the sole IT person in your company, and your boss wants a way to block certain websites from employees. What can you set up to help with this request

Answers

Answer:

proxy server

Explanation:

A proxy server is an application on a server that manages the requests when a a client tries to get the resources from the server and when someone is trying to get into a website the proxy server makes the request, provides the response from the web server and sends the data so it can be visualized and in this process, it can block the access to certain websites. According to that, the answer is that you have to set up a proxy server to help with this request as it will allow you to block the websites.

Having drugs available OTC has potential advantages and disadvantages for consumers. What is one of the advantages?

Answers

Answer:

Explanation:

One advantage to this and probably the most important advantage is that it provides faster and more convenient access to effective treatment. This is because individuals are able to simply walk into the store and as the pharmacist for the medicinal drug that they are looking for in order to treat their symptoms. This would not be possible if the drugs were not available OTC.

Iron Works International is considering a project that will produce annual cash flows of $37,400, $46,100, $56,800, and $22,300 over the next four years, respectively. What is the internal rate of return if the project has an initial cost of $113,600?

Answers

Answer:

16.73%

Explanation:

The computation of the internal rate of return is shown below:-

Let irr be x%

At irr, the present value of inflows = Present value of outflows.

So,

$113,600 = 37,400 ÷ 1.0x + 46,100 ÷ 1.0x^2 + 56,800 ÷ 1.0x^3 + 22,300 ÷ 1.0x^4

x = irr = 16.73%

Therefore for computing the internal rate of return we simply applied the above formula.

The concept "efficiency" has quite different meanings for economists (money out/money in), biologists (energy out/energy in), and political scientists (influence exerted/political capital expended) (Newell, 2001, p. 19). From this statement, we should deduce Group of answer choices It is impossible to integrate insights from economics, biology, and political science because the vocabulary cannot be integrated That as interdisciplinarians we must often bring out common meanings, making them applicable to different texts and contexts. Economists, Biologists, and Political Scientists cannot define words accurately.

Answers

Answer:

That as inter-disciplinarians we must often bring out common meanings, making them applicable to different texts and contexts.

Explanation:

To deduce is to reduce the choices of answers. Basically by deducing it means to reach to a common definition of the word efficiency in all the fields, whether it be economists, or biologists or political scientists.

This will ensure easy understanding and easy communication of the term at broader level. This will clearly provide for the better ease in all the fields of work.

As we relate to more than a single branch of knowledge, using a single term with different meaning in different branches turns the situation complex.

People and groups that provide an organization with its productive resources, and thus have a claim on and a stake in the organization, are known as

Answers

Answer:

Stakeholders

Explanation:

The stakeholders are the persons and group that have an interest in the company and it directly benefits or suffered from the organization actions

It includes various persons like employees, suppliers, investors, customers, government, unions, etc

Therefore according to the given situation, the answer is a  stakeholder as they have the stake in the organization

Differing measures, including but not limited to the FASB's choice, of the pension obligation can be based on

Answers

Answer:

All of the following

Explanation:

All of the following includes the circumstances stated below.

i) all years of the service, whether vested or non vested based on the current level of salary as the basic.

ii) only with the vested benefits, which shall be based on current salary level only.

iii) both vested or non vested salaries based on some future salaries.

With the term vested we mean, the employees which already owns some stated percentage of his retirement benefits.

Globalizations and information technology advances are primary reasons why supply chain management has become a competitive priority for companies

Answers

Answer:

True.

Explanation:

This statement is true, because globalization and technological advances were essential for the supply chain to become global and internationalized, this is due to the information and transport technologies that enable a quick and easy flow at each stage of the chain.

Therefore, supply chain management has been increasingly valued in the global market, where companies seek to outsource activities in their supply chain to achieve strategic and competitive advantages, such as reduced labor and raw material costs.

3. Which of the following is not a characteristic of a good citizen?
obeying laws
being informed about key issues
using natural resources wisely
owning property

Answers

Answer:

Owning property

Explanation:

Its the only one that affects solely 1 person rather than benefit the community as a whole

The principal attraction of __________ compared to RSA is that it appears to offer equal security for a far smaller bit size, thereby reducing processing overhead.

Answers

Answer:

elliptic curve cryptography

Explanation:

The principal attraction of ECC (Elliptic Curve Cryptography) compared to RSA is that it appears to offer equal security for a far smaller bit size, thereby reducing processing overhead.

What do you mean by Security?

By restricting others' freedom to act, security is resistance to potential harm (or other unwanted coercive change) caused by others.

A method of public-key encryption known as elliptic-curve cryptography (ECC) is based on the algebraic structure of elliptic curves over finite fields. ECC enables similar security to be achieved with smaller keys as compared to non-EC encryption (based on simple Galois fields).

Elliptic curves can be used for several applications, including key agreement, digital signatures, and pseudo-random generators.

Therefore, The principal attraction of ECC (Elliptic Curve Cryptography) compared to RSA is that it appears to offer equal security for a far smaller bit size, thereby reducing processing overhead.

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The flat tax

a. shifts the burden of taxes to businesses.
b. would complicate tax filing for most individuals.
c. departs from ability-to-pay principle of taxation.
d. is strictly proportional even when some income is exempted.

Answers

Answer:

c. departs from ability-to-pay principle of taxation.

Explanation:

The flat tax rate requires every person to pay the same percentage of their incomes as a tax component. Basically there is no distinction in earning $1,000 or $10,000.

This means the principle of taxation that is the rich class shall pay in order to provide basic facilities to the poor will not meet, if rich and poor are charged the same.

Accordingly this tax system departs from the basic principle of taxation.

A Prime Minister differs from a President in which of the following ways? Select all that apply.
A Prime Minister holds power as long as Parliament approves.
A Prime Minister holds office for six years, or until his party holds a vote of "no confidence."
A President is elected every four years, whereas Parliamentary elections are held every five years.
A President is elected by the general public, and a Prime Minister is the leader of the majority party in the House of Commons.
A Prime Minister can be ousted by a vote of "no confidence" by her/his party's parliamentary ministers.

Answers

Answer:

The Prime Minister is the head of the Executive branch of the Government in the United Kingdom as well as other Parliamentary or Semi-presidential Government systems.

The President is the head of the Executive branch of the Government in the United States and other Republican states.

The differences between the two especially between the United Kingdom and the United States is;

A President is elected by the general public, and a Prime Minister is the leader of the majority party in the House of Commons.

The President is elected directly by the will of the people which in the United States is represented by the Electoral College. The Prime Minister on the other hand is elected if their party and affiliates hold a majority in the House of Commons (Parliament).

A President is elected every four years, whereas Parliamentary elections are held every five years.

The Presidential election in the United States is held every 4 years with the next one being this year, 2020. By contrast Parliamentary elections in the UK are held every 5 years but this can be less if the Prime Minister dissolves parliament.

A Prime Minister can be ousted by a vote of "no confidence" by her/his party's parliamentary ministers.

As the Prime Minister is elected by their party's representatives in Parliament, they can also be removed by them. This happens when the members pass a vote of no confidence in the the minister.

The University of Dover and Dover University are bitter cross town rivals. They compete in everything from sports to academics. The schools, because of shrinking enrollment, make an agreement to give all incoming students free tuition for one semester before raising the existing rates the following semester. This action would be considered:______.a) a horizontal restraint violating the Sherman Act.b) a vertical restraint violating the Sherman Act.c) a tying agreement in violation of the Clayton Act.d) price discrimination in violation of the Robinson-Patman Act.

Answers

Answer:

A

Explanation:

A horizontal restraint in violation of the Sherman Act would be this action. As a result, option (A) is the preferable one.

What is the Sherman Antitrust Act of 1890?

The Sherman Antitrust Act of 1890 is an antitrust law from the United States that establishes the principle of unrestricted competition among those involved in commerce. Senator John Sherman, the primary author, is honored by the fact that it was adopted by Congress.

The Sherman Act broadly forbids 1) anticompetitive contracts and 2) unilateral actions that dominate or attempt to monopolize the relevant market. The Act permits private parties harmed by activity that violates the Act to file lawsuits for treble damages in addition to allowing the Department of Justice to file lawsuits to enjoin (i.e., ban) conduct that violates the Act.

Hence, option (A) is accurate.

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Z chooses a life income with 10 year period certain settlement option for the annuity Z owns. Z dies after 15 years of receiving income benefit payments. What does Z's beneficiary receive

Answers

Answer: Nothing

Explanation:

From the question, we are informed that Z chooses a life income with 10 year period certain settlement option for the annuity Z owns and that Z dies after 15 years of receiving income benefit payments. Based on the above situation, Z's beneficiary receive will receive nothing.

This is because Z has already gotten the income benefits payment since it's for a 10 year period

Capacity of a ship used to determine taxation of the ship by its country of registry or by port or canal authorities is called

Answers

Answer:

Gross Registered Tonnage. Hope this helps! =)

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