Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Management Theories Expert

USE THE GIVEN INFORMATION FOR THE NEXT PROBLEM(S):

1311_rate of return.jpg

problem 1: Refer to information above. find out the beta for RA Computer by using the historic returns presented above.
a) 0.7715
b) 1.2195
c) 1.3893
d) 1.1023
e) - 0.7715

problem 2: Refer to information above. find out the correlation coefficient between RA Computer and the Market Index.

a) -0.32
b) 0.78
c) 0.66
d) 0.58
e) 0.32

problem 3: Refer to information above. find out the intercept of the characteristic line for RA Computer.

a) -9.41
b) 11.63
c) 4.92
d) -7.98
e) -4.92

problem 4: Refer to information above. If you expected return on the Market Index to be 12%, what would you expect the return on RA Computer to be?

a) 7.26%
b) 6.75%
c) 8.00%
d) 9.37%
e) -3.29%

USE THE GIVEN INFORMATION FOR THE NEXT PROBLEM(S):

You expect the risk-free rate (RFR) to be 3% and the market return to be 8%. You as well have the given information about three stocks.

2166_risk free rate.jpg

problem 5: Refer to information above. What are the expected (required) rates of return for the three stocks (in the order X, Y, Z)?

a) 16.50%, 5.50%, 22.00%
b) 9.25%, 10.5%, 7.5%
c) 21.25%, 8.33%, 11.43%
d) 6.20%, 2.20%, 8.20%
e) 15.00%, 3.50%, 7.30%

problem 6: Refer to information above. What are the estimated rates of return for the three stocks (in the order X, Y, Z)?

a) 21.25%, 8.33%, 11.43%
b) 6.20%, 2.20%, 8.20%
c) 16.50%, 5.50%, 22.00%
d) 9.25%, 10.5%, 7.5%
e) 15.00%, 3.50%, 7.30%

problem 7: Refer to information above. What is your investment strategy regarding the three stocks?

a) Buy X and Y, sell Z.
b) Sell X, Y and Z.
c) Sell X and Z, buy Y.
d) Buy X, Y and Z.
e) Buy X and Z, sell Y.

problem 8: The expected return for Zbrite stock computed by using the CAPM is 15.5%. The risk free rate is 3.5% and the beta of the stock is 1.2. Computed the implied market risk premium.

a) 5.5%
b) 6.5%
c) 10.0%
d) 15.5%
e) 12.0%

problem 9: Consider the given two factor APT model:

E(R) = λ0 + λ1b1 + λ2b2

a) λ1 is the expected return on the asset with zero systematic risk.
b) λ1 is the expected return on asset 1.
c) λ1 is the pricing relationship between the risk premium and the asset.
d) λ1 is the risk premium.
e) λ1 is the factor loading.

problem 10: In the APT model the idea of riskless arbitrage is to assemble a portfolio that:

a) Needs some initial wealth, will bear no risk and still earn a profit.
b) Needs no initial wealth, will bear no risk and still earn a profit.
c) Needs no initial wealth, will bear no systematic risk and still earn a profit.
d) Needs no initial wealth, will bear no unsystematic risk and still earn a profit.
e) Needs some initial wealth, will bear no systematic risk and still earn a profit.

Management Theories, Management Studies

  • Category:- Management Theories
  • Reference No.:- M93418

Have any Question? 


Related Questions in Management Theories

Global supply chain managementquestion what economic

Global Supply Chain Management Question: What economic arguments can be made for and against environmental sustainability initiatives? What economic arguments can be made for and against social sustainability initiatives ...

Case study assignment -problem statement you need to

Case Study Assignment - Problem Statement: You need to consider how you will identify the range of issues and problems in the following problem statement. Boutique Hotel Company (BHCo) Please Note: This problem statement ...

A catfish bait manufacturer uses a secret blend of

A catfish bait manufacturer uses a secret blend of ingredients to make their infamous bait. One of these ingredients, we'll call it X for proprietary reasons, is the major component in the mixture. X is ordered in 55 gal ...

Question 1 in reflecting on the complementary nature of

Question 1: In reflecting on the complementary nature of managing and leading, John Kotter suggested that leadership is about coping with __________ while managing is about coping with __________. change; complexity comp ...

Assignment lasa- ikea analysis reportwhat is values-based

Assignment: LASA- IKEA Analysis Report What is values-based service? How can a company create value for customers and other stakeholders? Values-based service is defined as service that is firmly based on the core compan ...

Comparison in organizationusing your current work

Comparison in Organization Using your current work organization (or an organization of interest) and a second organization in the same industry as the subject matter, research the elements of business, compare and contra ...

Questionas a supply chain consultant for a global company

Question: As a supply chain consultant for a global company one has to be aware of the extra costs of importing goods into the US. US Customs can add significant costs to ownership when you add Anti-Dumping (AD) and Coun ...

1 what is coso and why is it important search the internet

1. What is COSO, and why is it important? Search the Internet for the term "Treadway Commission." What was the Treadway Commission, and what is its major legacy in the field of InfoSec? 2. Search the Internet for the ter ...

There are production facilities in battle creek cherry

There are production facilities in Battle Creek, Cherry Creek, and Dee Creek with annual capacities of 500 units, 400 units, and 600 units, respectively. The annual demands at warehouses in Worchester, Dorchester, and Ro ...

Question onewhat results in your departments seem to be

Question one: What results in your departments seem to be correlated or related (either causal or not) to other activities? How could you verify this? What are the managerial implications of a correlation between these v ...

  • 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