Adam wants to determine the required return on a stock portfolio with a beta coefficient of 0.5. Assuming the risk- free rate of 6 percent and the market return of 12 percent, compute the required rate of return.

Q: Define constant yield method

A: It is the method of ascertaining the collected discount of securities that trade the secondary…

Q: Define cost behaviour.

A: High-Low Method: The high-low method is the method by which the variable component and the fixed…

Q: Define total net present value (TNPV)

A: Total net present value of an investment is the present value of the future cash inflows due to a…

Q: Explain renewal probability?

A: Answer: Renewal probability is nothing but the average percentage of renters in a building that is…

Q: Define the term internal rate of return?

A: The internal rate of return (IRR) is a capital budgeting metric used to gauge the benefit of…

Q: How do i caculate the fixed cost

A: The objective of this question is to understand how to calculate the fixed cost in a business. Fixed…

Q: Which are the more complex applications of rate-of-return techniques/

A: The question is based on the concept of rate of return and its application in finance

Q: Explain Computing Holding Period Returns?

A: Introduction: Holding period returns (HPRs): Holding period return (HPR) is one of the investment…

Q: Comparison of NPV, IRR or Payback period

A: The net present value (NPV) is the difference between the present value of cash inflows and…

Q: what is meant by the required rate of return

A: The return which is expected to be earned by investing in a security is known as Required Rate of…

Q: How can we determine the operating margin?

A: Operating margin refers to percentage of net operating income over the sales of the company.

Q: How can we obtain an equal-payment series equivalent to the gradient series?

A: The question is based on the concept of gradient series of payments, which is used in equivalent…

Q: Define reinvestment rate risk

A: Reinvestment means investing without withdrawing the benefits (or) interest from the fund so that it…

Q: What is meant by partitioning the internal rate of return? Why is this procedure meaningful?

A: Internal rate of return is defined as the annual rate of earnings on an investment and unlike income…

Q: Explain Pass-Through Rates, Yields, and Servicing Fee?

A: Pass-through rateA rate of interest being paid to the investors on the securitized asset after…

Q: What is the ROE and operating Margin?

A: ROE = Net Income/Shareholders equity In the given case, Shareholders equity is 60 % of the vehicle…

Q: how was the rate calculated, without excel

A: Given, The loan amount is $1000 Rate is 4% Fifth installment is $525