Answer:
Company Price of Bond
Miller Corporation $1,218.32
Modigliani Company $810.92
Explanation:
The value of the bond is the present value (PV) of the future cash receipts expected from the bond. The value is equal to present values of interest payment plus the redemption value (RV).
Value of Bond = PV of interest + PV of RV
The value of bond Miller Corporation can be worked out as follows:
Step 1
PV of interest payments
Semi annul interest payment = 8%× 1000× 1/2 =40
Semi-annual yield = 6%/2 = 3% per six months
Total period to maturity (in months) = (2 × 18) = 36 periods
PV of interest =
40× (1- (1+0.03^(-36)/0.03)= 873.29
Step 2
PV of Redemption Value
= 1,000 × (1.03)^(-36) =345.03
Step 3:
Price of bond
= 873.29 + 345.03= $1,218.32
Modigliani Company
Step 1
PV of interest payments
Semi annul interest payment = 6%× 1000× 1/2 =30
Semi-annual yield = 8%/2 = 4% per six months
Total period to maturity (in months) = (2 × 18) = 36 periods
PV of interest =
30× (1- (1+0.04^(-36)/0.04)= 567.25
Step 2
PV of Redemption Value
= 1,000 × (1.03)^(-36) =243.66
Step 3:
Price of bond
= 567.2484586 + 243.66 = $810.92
Price of bond = $810.92
A student goes into Amazon to purchase a biology textbook that was published by McGraw-Hill Higher Education and then sold to Amazon through a book wholesaler. In this marketing channel, Amazon would best be classified as a
Answer:
Virtual retailer, is the right answer.
Explanation:
A virtual retailer is a correct answer because the supply chain includes that manufacturer manufacture the product and then the whole seller sells the product to the retailer. Here the same trend can be seen that the McGraw-Hill publish a book so this company is a manufacturer and the last step from where the consumer to buy the commodity is the amazon. So amazon is classified as a virtual retailer.
The common stock of Flavorful Teas has an expected return of 14.31 percent. The return on the market is 9 percent and the risk-free rate of return is 3.1 percent. What is the beta of this stock
Answer:
1.9
Explanation:
The common stock of flavorful tea has an expected return of 14.31%
=14.31/100
= 0.1431
The return on the market is 9%
= 9/100
= 0.09
The risk free rate of return is 3.1%
= 3.1/100
= 0.031
Therefore, the beta can be calculated as follows
0.1413= 0.031 + beta(0.09-0.031)
0.1413= 0.031 + 0.09beta-0.031beta
0.1413=0.031 +0.059beta
0.1413-0.031= 0.059beta
0.1121= 0.059beta
beta= 0.1121/0.059
beta= 1.9
Hence the beta of this stock is 1.9
Alistar Inc. recently issued $90 par value preferred stock that pays a 8.25% dividend rate per year. If the stock is currently selling for $85, what is the expected return of this preferred stock?
Answer:
8.74%
Explanation:
Calculation for the expected return of this preferred stock
First step is to find the Annual dividend using this formula
Annual dividend= Par value x Dividend rate
Let plug in the formula
Annual dividend=$90 par value×8.25% dividend rate
Annual dividend=7.425
Second step is to calculate for the expected return of the preferred stock
Using this formula
Expected return=Annual dividend/Current price
Let plug in the formula
Expected return=7.425/$85
Expected return=8.74%
Therefore the expected return of this preferred stock will be 8.74%
As a comparable, an expired listing can be a useful indicator of a listing period that was too short. a listing price that was too high for the market. a seller who was flexible. a property that was not as good as its competitors.
Answer: a listing price that was too high for the market.
Explanation:
An expired listing occurs when the house for sale was not sold in the time period that was allowed by the contract between the house owner and the sales agent.
If this was to happen then it could be because prospective buyers deemed the house to be worth less than it was being offered for and so did not buy it. Both the seller and the agent can learn from this as it very much could be an indicator that the listing price was too high for the market.
Which of the following is true of taxes and subsidies? Group of answer choices Politicians like to levy taxes, but they are reluctant to subsidize activities. Both taxes and subsidies increase the incentive to work and use resources efficiently. If you tax something, you will get less of it; if you subsidize an activity, you will get more of it. If you tax something, you will get more of it; if you subsidize an activity, you will get less of it.
Answer: If you tax something, you will get less of it; if you subsidize an activity, you will get more of it
Explanation:
Taxes are the levy that governments impose on people or firms. Subsidies are financial aid to companies in order to boost production and reduce price.
It should be noted that if you tax something, you will get less of it; if you subsidize an activity, you will get more of it. For example of an income is taxed, the owner of the income will geta lesser amount as tax will be removed.
As a preferred stockholder, you are entitled to numerous preferences and privileges over common stockholders. If you are a preferred stockholder of a company that has fallen on economic hardship and is likely to go bankrupt, which preference or privilege of preferred stock is going to be most useful to you
Answer:
asset distribution preference
Explanation:
In such a situation the preference or privilege that would be best for you is known as asset distribution preference or liquidation preference. This is a clause that dictates that the payout in case of a corporate liquidation (such as when they are about to go bankrupt) must first go to the preferred stockholders in order for them to get their money back first. Therefore, since you are a preferred stockholder this would be the biggest privilege for you, allowing you to recover your money quickly and move on to something else.
A bond issue with a face amount of $400,000 bears interest at the rate of 8%. The current market rate of interest is 9%. These bonds will sell at a price that is:
The question is incomplete. The complete question is,
A bond issue with a face amount of $400,000 bears interest at the rate of 8%. The current market rate of interest is 9%. These bonds will sell at a price that is:
More than $400,000.
Equal to $400,000.
Less than $400,000.
The answer cannot be determined from the information provided.
Answer:
The bond sells at a price less than $400000
Explanation:
The coupon rate of bonds is the interest rate at which the bond will pay the interest. When the coupon rate of a bond is less than the market interest rate or the Yield to Maturity (YTM), the bond sells at a discount in the market. On the other hand, if the coupon rate of bond is greater than the market interest rate, the bond sells at a premium.
As the coupon rate of the given bond is 8% which is less than the market interest rate of 9%, the bond sells at a discount. Thus, the price at which the bond sells is less than $400000.
Timberly Construction negotiates a lump-sum purchase of several assets from a company that is going out of business. The purchase is completed on January 1, 2015, at a total cash price of $820,000 for a building, land, land improvements, and four vehicles. The estimated market values of the assets are building, $492,900; land, $260,400; land improvements, $55,800; and four vehicles, $120,900. The company’s fiscal year ends on December 31. Required: 1.1 Prepare a table to allocate the lump-sum purchase price to the separate assets purchased. 1.2 Prepare the journal entry to record the purchase. 2. Compute the depreciation expense for year 2015 on the building using the straight-line method, assuming a 15-year life and a $32,000 salvage value. (Round your answers to the nearest whole dollar.) 3. Compute the depreciation expense for year 2015 on the land improvements assuming a five-year life and double-declining-balance depreciation.
1.1
Prepare a table to allocate the lump-sum purchase price to the separate assets purchased.
1.2
Prepare the journal entry to record the purchase.
2. Compute the depreciation expense for year 2015 on the building using the straight-line method, assuming a 15-year life and a $32,000 salvage value. (Round your answers to the nearest whole dollar.)
3.
Compute the depreciation expense for year 2015 on the land improvements assuming a five-year life and double-declining-balance depreciation.
Answer:
1.1) asset FMV purchase price
building $492,900 $434,600
land $260,400 $229,600
land improvements $55,800 $49,200
four vehicles $120,900 $106,600
total $930,000 $820,000
1.2) January 1, 2015, assets purchased
Dr Building 434,600
Dr Land 229,600
Dr Land improvements 49,200
Dr Vehicles 106,600
Cr Cash 820,000
2) depreciation expense (building) for 2015 = ($434,600 - $32,000) / 15 = $26,840 per year
3) depreciation expense (land improvements) for 2015 = $49,200 x 2 x 1/5 = $19,680
Explanation:
total cash $820,000:
FMV building $492,900, ($492,900/$930,000) x $820,000 = $434,600
FMV land $260,400, ($260,400/$930,000) x $820,000 = $229,600
FMV land improvements $55,800, ($55,800/$930,000) x $820,000 = $49,200
FMV four vehicles $120,900, ($120,900/$930,000) x $820,000 = $106,600
total FMV = $930,000
In a planned economy, prices of commodities are controlled by _________.
The correct answer is C. The government
Explanation:
The key feature of a planned economy is the strong influence and control of government in the economy. Indeed, in a planned economy it is the government the entity that decides on trade and production, this includes the prices of goods and the types of products that should be manufactured. Moreover, this does not occur in market economies because in these customers, produces and the law of supply/demand determine factors of the economy. According to this, in a planned economy prices are controlled by government.
The profit-maximizing output level is 4 units. 4.5 units. 2.5 units. 3 units. b. The profit-maximizing price is $14.30. $25. $40. $32.50. c. The firm has an economic profit of -$30.00. $0. $30.00. $45.50. $18.75. d. If the firm was forced to charge a price that resulted in allocative efficiency, this price would be $20. $14.30. $32.50. $25. e. If the firm was forced to charge a price that resulted in productive efficiency, the output level would be 4 units 2.5 units 0 units 4.5 units
Please see full Question attached Answer and Explanation:
A. Answer A : profit is maximised at output level 2.5 units where marginal revenue(MR) equal to marginal cost(MC)
B. Answer A: Profit is maximised at price $40 where the demand curve matches marginal revenue and marginal cost .
C. Answer C : Economic profit is equal to zero .
D. Answer D. Allocative efficiency is achieved where demand is equal to marginal cost. Level of output at this point is equal price at $25
E. Answer C. Efficient level of output is achieved where average total cost is lowest. From the diagram average total cost is lowest at output level 4.5 units.
Wyly Inc. produces and sells a single product. The selling price of the product is $215.00 per unit and its variable cost is $66.65 per unit. The fixed expense is $405,099 per month. The break-even in monthly dollar sales is closest to:______.
a. $1,306,771.
b. $901,672.
c. $587,100.
d. $405,099.
Answer:
c. $587,100.
Explanation:
The computation of the break even sales in dollars is shown below:
Break Even Sales = Fixed Cost ÷ Contribution Margin Ratio
where,
Fixed cost is $405,099
And, the contribution margin ratio is
= (sales price - variable cost) ÷ sales price
= ($215 - $66.65) ÷ $215
= 69%
Now placing these above formulae to the given formula
= $405,099 ÷ 0.69
= $587,100
Hene, the correct option is c. $587,100
The manufacturing costs of Ackerman Industries for the first three months of the year follow:
Total Costs Units Produced
January $1,900,000 20,000 units
February 2,250,000 27,000
March 2,400,000 30,000
Using the high-low method, determine (a) the variable cost per unit and (b) the total fixed cost. Round all answers to the nearest whole dollar.
a. Variable cost per unit $
b. Total fixed cost $
Answer:
a. $50
b. $500,000
Explanation:
The computation of the fixed cost and the variable cost per unit by using high low method is shown below:
a. Variable cost per unit = (High total cost - low total cost) ÷ (High number of units produced - low number of units produced)
= ($2,400,000 - $1,900,000) ÷ (30,000 units - 20,000 units )
= $500,000 ÷ 10,000 units
= $50
b. Now the fixed cost equal to
= High total cost - (High number of units produced × Variable cost per unit)
= $2,400,000 - (30,000 units × $50)
= $2,400,000 - $1,500,000
= $900,000
Cox Corporation was organized on January 1, 2003, at which date it issued 100,000 shares of $10 par common stock at $15 per share. During the period January 1, 2003, through December 31, 2005, Cox reported net income of $450,000 and paid cash dividends of $230,000. On January 10, 2005, Cox purchased 8,000 shares of its common stock at $4 per share. On December 31, 2005, Cox sold 6,000 treasury shares at $12 per share. What is Cox's total stockholders' equity at December 31, 2005?
Answer: $1,760,000
Explanation:
Total Shareholder Equity = Common share + Net Income - Dividends - Treasury stock
Common share
= 100,000 * 15
= $1,500,000
Net Treasury Stock
= Treasury stock bought - Treasury stock sold
= (8,000 * 4) - (6,000 * 12)
= 32,000 - 72,000
= -40,000
Total Shareholder Equity = Common share + Net Income - Dividends - Treasury stock
= 1,500,000 + 450,000 - 230,000 - (40,000)
= 1,500,000 + 220,000 + 40,000
= $1,760,000
Golden Enterprises started the year with the following: Assets $125.000: Liabilities $42,500: Common Stock $73,000, Retained Earnings $11,000 During the year, the company earned revenue of $6,700, all of which was received in cash, and incurred expenses of $3,850, all of which were unpaid as of the end of the year. In addition, the cominy paid dividends of $2700 to owners. Assume no other activities occurred during the year The amount of Golden's retained earnings at the end of the year is:_________
Answer:
$11,150
Explanation:
The amount of Golden's retained earnings at the end of the year is calculated below
Ending retained earnings = Beginning retained earnings + Net income - Dividends
= $11,000 + ($6,700 - $3,850) - $2,700
= $11,150
Question 2 options: Use the following total product schedule as a resource to answer questions a, b, and c. Assume that the quantities of other resources the firm employs remain constant. Total Product Schedule Number of Workers Total Product 0 0 1 15 2 28 3 38 4 43 5 46 Instructions: Enter all values as whole numbers (no decimal places). a) If the firm's product sells for a constant $2 per unit, what is the marginal revenue product of the second worker
Answer:
The marginal revenue product (MRP) = $26 (13 x $2).
Explanation:
a) Data and Calculations:
Total Product Schedule
Number of Total Marginal Selling Total Marginal
Workers Product Product Price Revenue Revenue
0 0 0 $2 $0 $0
1 15 15 $2 $30 $30
2 28 13 $2 $56 $26
3 38 10 $2 $76 $20
4 43 5 $2 $86 $10
5 46 3 $2 $92 $6
b) The marginal revenue product is calculated by multiplying the marginal physical product (MPP) of the second worker by the marginal revenue (MR) $2 selling price.
Which of the following is a condition that triggers the penalty for negligence or intentional disregard? 1) the taxpayer understates their tax by the larger of $5,000 or 10% of the correct tax. 2) the taxpayer shows negligence or disregard of the rules or regulations, causing an underpayment. 3)The taxpayer fails to pay the tax owed by the due date. 4) the taxpayer fails to file the return by the due date, and there is balance due.
Answer:
2) the taxpayer shows negligence or disregard of the rules or regulations, causing an underpayment.
Explanation:
When any taxpayer shows some negligence or if they disregard the rules and the regulations, causing an underpayment, then it leads to a penalty for the disregard or the negligence.
Also, when a taxpayer intentionally understates his or her tax by a larger of $5000 or a 10% of his / her correct tax, then it is an accuracy related penalty.
And, also the information related penalties which are levied for failure of taxpayer to pay the amount of tax owed by due date and also failure to filing the return by the due date.
Thus option (2) is correct.
The role of the government in establishing how private business can operate includes all of the following except:a)providing legal frameworkb)PROVIDING RAW MATERIAL TO BUSINESSc)protecting the environmentd)protecting consumers
Answer: providing raw material to business
Explanation:
It should be noted that the government of every economy plays a major role regarding the operations of businesses. The role of the government in establishing how private business can operate include providing legal framework, protecting the environment and also protecting th consumers.
It is not the role of the government to provide raw materials for industries.
Select the best description of the incentive for each of the following participants based on the current U.S. health care system.Consumers will ______________a. request the fewest treatments to save timeb. have no incentive to consume more or less medical carec. request as much treatment as possible to maximize healthcare benefitsProducers will _______________a. have no incentive to consume more or less medical careb. prescribe as much treatment as possible to increase profitc. prescribe fewer visits and procedures to save timeIntermediaries will ______________a. have no incentive to consume more or less medical careb. allow as few treatments as possible to maximize profitc. allow any treatment that might be possibly help a patient
Answer:
Select the best description of the incentive for each of the following participants based on the current U.S. health-care system:
Consumers will ______________
c. request as much treatment as possible to maximize healthcare benefits
Producers will _______________
b. prescribe as much treatment as possible to increase profit
Intermediaries will ______________
b. allow as few treatments as possible to maximize profit.
Explanation:
The current US healthcare system is acclaimed worldwide as very expensive. It is controlled by capitalistic tendencies where healthcare providers are more interested in maximising their profits rather than maximizing healthcare benefits. Since the US government does not provide health benefits to citizens or visitors, the costs for rendering healthcare are not being monitored and controlled. Unfortunately, to see your primary care provider (PCP), it may take several days before you are attended to after booking an appointment with the organization. The only rescue available these days is the technological innovation provided by telemedicine.
g A machine with a cost of $130,000 and accumulated depreciation of $85,000 is sold for $50,000 cash. The amount that should be reported as a source of cash under cash flows from investing activities is: Group of answer choices
Answer: $50,000
Explanation:
From the question, we are informed that a machine with a cost of $130,000 and accumulated depreciation of $85,000 is sold for $50,000 cash.
The amount that should be reported as a source of cash under cash flows from investing activities will be $50,000. It should be noted that only cash effects of transaction has to be added to the cash flow statement.
Mia has an outside basis of $50,000 in the Brimstone Partnership, including her share of liabilities of $25,000. In a liquidating distribution, she receives cash of $10,000 and inventory worth $8,000 (inside basis to Brimstone of $20,000). What is Mia's recognized gain or loss on the liquidation and basis in the property received
Answer:
No gain or loss, Cash basis $10,000, Inventory $15,000
Explanation:
Calculation for Mia’s recognized gain or loss
First step is to calculate for Mia outside adjusted basis
Using this formula
Outside adjusted basis=Outside basis - Liabilities
Let plug in the formula
Outside adjusted basis=$50,000 - $25,000
Outside adjusted basis= $25,000
Second step is to calculate for Mia Gain or loss
Using this formula
Gain/Loss=Outside adjusted basis- Cash received - Inside basis
Let plug in the formula
Gain/Loss =$25,000 -$10,000 -$20,000
Gain/Loss = ($5,000)
Since Mia had ($5,000) this means Mia has no gain or loss
Last step is to calculate for Mia Inventory
Using this formula
Inventory = Cash + Gain/Loss
Let plug in the formula
Inventory =$10,000 + $5,000
Inventory = $15,000
Therefore Mai has NO gain or loss, Cash basis amount of $10,000 and Inventory amount of $15,000
A correlation coefficient of zero indicates Question 38 options: a) there is no correlation and no risk reduction when the projects are combined. b) the projects have the same expected value. c) there is no correlation, but there is some risk reduction when the projects are combined. d) the projects have the same standard deviation.
Answer: c) there is no correlation, but there is some risk reduction when the projects are combined.
Explanation:
The correlation coefficient measures the relationship between the movement of two assets. If they are positively correlated, the assets will move in the same direction. If they are negatively correlated, the assets will move in opposite directions.
When the correlation is zero though then there will be no correlation. That does not mean that there will be no risk attached however because investing in both can still lead to a loss if both assets are affected by the same event.
The only riskless investment would be those that are perfectly negatively correlated because then you would be sure that when one makes a loss in one, a gain will definitely be made in the other.
tahir owns and operates a gym. In 2020, he purchased and placed the following new assets into service for his business: March 17, a $1,700 sound system; July 4, a $500 desk; September 2, a $2,000 computer. He did not opt out of bonus depreciation. What is the total 2020 depreciation for the desk
Answer:
$500
Explanation:
Since the Cost of the desk is $500
Also Tahir did not pt out for the bonus depreciation so in this case the 100% cost to be claimed as the bonus depreciation for the year 2020 with respect to the qualifying assets that are purchased in the year 2020
Hence, the total depreciation for the desk in the year is $500 and the same is to be considered
A commercial bank will loan you $20,000 for four years to buy a car. The loan must be repaid in 48 equal monthly payments. The annual interest rate on the loan is 6.00 percent of the unpaid balance. How large are the monthly payments?
Answer:
Monthly payment = $469.701
Explanation:
Loan Amortization: A loan repayment method structured such that a series of equal periodic installments will be paid for certain number of periods to offset both the loan principal amount and the accrued interest.
The monthly equal installment is calculated as follows:
Monthly equal installment= Loan amount/Monthly annuity factor
Loan amount = 20,000
Monthly annuity factor =
=( 1-(1+r)^(-n))/r
r- Monthly interest rate (r)
= 6/12= 0.5%
n- Number of months ( n) = 20 × 4 = 48
Annuity factor
= ( 1- (1.005)^(-48)/0.005= 42.5803
Monthly installment= 20,000 /42.5803 = $469.701
Monthly installment = $469.701
Monthly payment = $469.701
For each of the following, indicate whether the idea is most closely associated with the first industrial revolution, the second industrial revolution, neither, or both. Mechanization The possibility of traveling from coast to coast in the US in under a week Feedback loops
1. First Industrial Revolution The internet
2. Second Industrial Revolution The flying shuttle
3. Neither The steam engine
4. Both Railroads Telegraph A technological (as opposed to political) revolution
Answer:
The possibility of traveling from coast to coast in the US in under a week ⇒ SECOND INDUSTRIAL REVOLUTIONFeedback loops ⇒ BOTHThe internet ⇒ NEITHERThe flying shuttle ⇒ NEITHERThe steam engine ⇒ FIRST INDUSTRIAL REVOLUTIONRailroads ⇒ BOTHTelegraph ⇒ SECOND INDUSTRIAL REVOLUTION A technological (as opposed to political) revolution ⇒ SECOND INDUSTRIAL REVOLUTIONExplanation:
The first industrial revolution took place between 1760-1830 (roughly) and its main characteristics were the industrialization of production processes using stream power.
The second industrial revolution took place between 1870-1914 (beginning of WWI). Production processes were enhanced as well as the production of steel. Even though some systems were invented much earlier, during the second industrial revolution they became "popular" and were adopted in many places and became common things, e.g. railroad networks, telegraph and telephone, water systems, sewage, electricity, and even pencils.
a customer has invested 20000 in a variable annuity. in the first year nav increases to 21100 at what rate wsill 1100 gain be taxed
Answer: 0%
Explanation:
The $20,000 contribution to the variable annuity is not taxed and neither is the gain, at least not yet.
With the variable annuity, the gains/earnings will be tax-deferred and the customer will only have to pay taxes when they withdraw the contributions.
When this happens they will be charged at the normal income tax rate.
Profit, time and performance are all basic classifications of project priorities.
a) true
b) false
Answer:
b) false
Explanation:
The basic classifications of project priorities are cost, time and performance. Profit is not included in the list, cost is included.
A project manager must decide how to manage the trade offs between cost, time and performance. E.g. if you want something well done and cheap, you cannot expect to have it done fast. If you want something done well and fast, it wouldn't be cheap.
If inputs increase by 15% and outputs increase by 15%, what is the percentage change in productivity?
Answer:
0%
Explanation:
If input increase by 15% and output increase by 15% then the equation for productivity will be
Input = 100% + 15% = 115%
Output = 100% + 15% = 115%
[tex]productivety =\frac{Outpu t }{Inpu t}[/tex]
[tex]productivety=\frac{1.15}{1.15}[/tex]
[tex]productivty = 1[/tex]
Percentage change = 1-1
Percentage change = 0%
If both Output and input is increased by the same amount the results will be the same
Which function of the management process requires a manager to establish goals and standards and to develop rules and procedures?
Answer:
The planning function of management includes establishing goals and standards, developing rules and procedures, and developing plans and forecasting
Explanation:
Planning is the function of management that involves setting objectives and determining a course of action for achieving those objectives.
If the residual value of a leased asset is guaranteed by a third party:________.
A. it is treated by the lessee as no residual value.
B. the third party is also liable for any lease payments not paid by the lessee.
C. the net investment to be recovered by the lessor is reduced.
D. it is treated by the lessee as an additional payment and by the lessor as realized at the end of the lease term.
Answer:
A. it is treated by the lessee as no residual value.
Explanation:
If the expected residual value is in assurance or unguaranteed, that's the economic and accounting product of the lesses
Furthermore, the guaranteed residual value also affects the computation of the minimum lease payment and the capitalised amount for an asset i.e. leased, lease obligation for the lessee
The promised residual value is an extra lease payment that can be paid in real estate or in cash, or both
Although the unguaranteed residual value, on the other hand, stays the same because no residual value will be impacted with respect to the estimation of the total lease payment and the capitalised amount for an asset, i.e. rented, lease contract.
The last four years of returns for a stock are as follows: Year 1 2 3 4 Return −4.5% 28.1% 12.2% 3.7% a. What is the average annual return? b. What is the variance of the stock's returns? c. What is the standard deviation of the stock's returns?
Answer:
a. What is the average annual return?
average annual return (mean) = (-4.5% + 28.1% + 12.2% + 3.7%) / 4 = 9.875%
b. What is the variance of the stock's returns?
variance = [(-4.5% - 9.875%)² + (28.1% - 9.875%)² + (12.2% - 9.875%)²) + (3.7% - 9.875%)²] / 4 = (206.64 + 332.15 + 5.41 + 38.13) / 4 = 582.33 / 4 = 145.5825
c. What is the standard deviation of the stock's returns?
standard deviation = √145.5825 = 12.06%