This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: A friend brags that she expects to earn a return of 10.25 on her portfolio with a beta of 0.825. ... (Read 34 times)

jayhills49

  • Hero Member
  • *****
  • Posts: 559
on: Jul 10, 2018
A friend brags that she expects to earn a return of 10.25 on her portfolio with a beta of 0.825.
 
  Can you match her performance with Stock X (12 return and a beta of 1.1 ) and the risk free asset that earns a 5 return? With what portfolio weights?
  A) Yes, 0.75 Stock X and 0.25 Risk Free Asset
  B) Yes, 0.25 Stock X and 0.75 Risk Free Asset
  C) Yes, 0.5 Stock X and 0.5 Risk Free Asset
  D) No

Question 2

Your uncle offers you a stream of payments whose present value, today, is 62,000. There are 15 equal annual payments in the stream. The first payment in the stream occurs seven years from today.
 
  If the interest rate is 14, then what is the value of each payment?
  A) 22,156.40
  B) 19,435.43
  C) 25,258.29
  D) 28,794.45
  E) 10,094.16


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

amandalm

  • Sr. Member
  • ****
  • Posts: 306
Reply #1 on: Jul 10, 2018
Answer to Question 1

A

Answer to Question 2

A


jayhills49

  • Hero Member
  • *****
  • Posts: 559
Reply #2 on: Jul 10, 2018
TY


amandalm

  • Sr. Member
  • ****
  • Posts: 306
Reply #3 on: Jul 10, 2018
Happy to Help


« previous next »
 

Did you know?

Interferon was scarce and expensive until 1980, when the interferon gene was inserted into bacteria using recombinant DNA technology, allowing for mass cultivation and purification from bacterial cultures.

Did you know?

The Centers for Disease Control and Prevention has released reports detailing the deaths of infants (younger than 1 year of age) who died after being given cold and cough medications. This underscores the importance of educating parents that children younger than 2 years of age should never be given over-the-counter cold and cough medications without consulting their physicians.

Did you know?

About 100 new prescription or over-the-counter drugs come into the U.S. market every year.

Did you know?

Despite claims by manufacturers, the supplement known as Ginkgo biloba was shown in a study of more than 3,000 participants to be ineffective in reducing development of dementia and Alzheimer’s disease in older people.

Did you know?

Multiple experimental evidences have confirmed that at the molecular level, cancer is caused by lesions in cellular DNA.

Alpha, beta, gamma amino acids Alpha, beta, gamma amino acids
Daniel's Enterprises has a beta of 1.98 and a growth rate of 12 percent. The stock is ... Daniel's Enterprises has a beta of 1.98 and a growth rate of 12 percent. The stock is ...
What principal will earn $77.14 interest at 6.65% p. What principal will earn $77.14 interest at 6.65% p.
Annotation of a DNA sequence containing part of the human beta-globin gene Annotation of a DNA sequence containing part of the human beta-globin gene
The distribution of malaria and of the hemoglobin variants beta S and beta E. The distribution of malaria and of the hemoglobin variants beta S and beta E.
Message from friend Message from friend
Video: ribosome

For a complete list of videos, visit our video library