Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Basic Finance Expert

1) Given following probability distribution for assets x and y, find out expected rate of return, variance, standard deviation, and coefficient of variation for two assets. Which asset is a better investment?
X Y

Return Probability Return Probability
8% .10 10% .25
9% . 20 11% .35
11% . 30 12% .40
12% .40

2) You are going to invest= $20,000 in portfolio consisting of assets x, y, z, as follows:

Asset Annual Return Probability Beta Proportion
X 10% .50 1.2 .33333
Y 8% .25 1.6 .33333
Z 16% .25 2.0 .33333

a) Giving the information in the above table, what is the expected annual return of this portfolio?

b) Determine the beta of this portfolio?

3) Dr. Ray is considering investment in the project with beta coefficient of= 1.75. What would you suggest him to do if this investment has= 11.5% rate of return, risk free rate is= 5.5%, and rate of return on market portfolio of assets is= 8.5 %?

4) Asset Y has a beta of= 1.2. Risk free rate of return is 6%, whereas the return on market portfolio is 12%. Assets market risk premium is?

5) Supposing a risk-free rate of= 8% and market return of= 12%, would wise investor obtain security with beta of 1.5 and a rate of return of= 14% given facts above?

Basic Finance, Finance

  • Category:- Basic Finance
  • Reference No.:- M914886

Have any Question? 


Related Questions in Basic Finance

For each of the following research goals assume that the

For each of the following research goals, assume that the experimental, correlational, and descriptive strategies are not being used, and identify which nonexperimental or quasi-experimental research design(s) would be m ...

1 why is motor carrier freight transportation the most

1. Why is motor carrier freight transportation the most preferred method of product shipment? 2. What is the economic justification for the recent rapid growth of premium package services? 3. Why is it important for a lo ...

Go to one of the web sites that contain video clips such as

Go to one of the Web sites that contain video clips (such as www.youtube.com) and review some video clips that are available about reducing your taxes. You can use search phrases in the Web site such as "tax savings tips ...

Staton-smith software is a new start-up company and will

Staton-Smith Software is a new start-up company and will not pay dividends for the first five years of operation. It will then institute an annual cash dividend policy of $5.00 with a constant growth rate of 3%, with the ...

1 what are four primary reasons that behavioral researchers

1. What are four primary reasons that behavioral researchers use case studies? 2. What is a psychobiography? 3. Why are behavioral scientists reluctant to trust case studies as a means of testing hypotheses?

Consider rolling a fair 6-faced die twice let a be the

Consider rolling a fair 6-faced die twice. Let A be the event that the sum of the two rolls is atmost 6, and B be the event that the first one is an even number. (a) What is the probability that the sum of the two rolls ...

Suppose that you are following the stock of a firm that has

Suppose that you are following the stock of a firm that has been experiencing severe problems. Failure is imminent unless the firm is granted government guaranteed loans. If the firm fails, its stock will, of course, fal ...

You have an absolutely brilliant child who is six years old

You have an absolutely brilliant child who is six years old and will be attending a private college in twelve years. You know that in twelve years a four-year college will cost at least $70,000 per year (total $280,000), ...

Modern machines try to execute many instructions at the

Modern machines try to execute many instructions at the same time, including branching instructions. Thus, there is a severe cost if the machine speculatively follows one branch, when control actually goes another way (a ...

Question again1 interest rates the cost of money

QUESTION AGAIN #1 Interest rates, the cost of money, influence most all factors related to personal and corporate capital budgeting. The more obvious personal information for the cost of money is the rates associated wit ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

WalMart Identification of theory and critical discussion

Drawing on the prescribed text and/or relevant academic literature, produce a paper which discusses the nature of group

Section onea in an atwood machine suppose two objects of

SECTION ONE (a) In an Atwood Machine, suppose two objects of unequal mass are hung vertically over a frictionless

Part 1you work in hr for a company that operates a factory

Part 1: You work in HR for a company that operates a factory manufacturing fiberglass. There are several hundred empl

Details on advanced accounting paperthis paper is intended

DETAILS ON ADVANCED ACCOUNTING PAPER This paper is intended for students to apply the theoretical knowledge around ac

Create a provider database and related reports and queries

Create a provider database and related reports and queries to capture contact information for potential PC component pro