Expected return

Q: Define constant yield method

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

Q: Can I calculate the Rate of Return using the NPV/initial investment? Why or why not?

A: When an investment is made in a certain project, its future outcomes are measured based on the money…

Q: Assuming that the pure expectations theory is correct, how are expected short-termrates used to…

A: Pure expectations theory believes that expected future rates can be represented by the forward…

Q: You just paid $351, 000 for a policy that will pay you and your heirs $12, 300 a year forever. What…

A: In this question we require to compute the rate of return from below details : Price paid for policy…

Q: Return on investment The income from operations and the amount of invested assets in each division…

A: Return on investment is calculated by dividing the income from operations by the invested assets.

Q: Explain the term Annual Effective Yields?

A: Annual effective yield: Annual effective yield is defined as the simple rate of interest that gives…

Q: What is the formula to find an expected in returns in CAPM

A: In this question, we are required to determine the formula for expected return in Capital Asset…

Q: 11-2 What is the expected return of the following investment? Probability Payoff 0.3 30.0% 0.2 10.0…

A: The expected return is the minimum required rate of return which an investor required from the…

Q: You own a bond that has a par value of $1,000 and matures in 5 years. It pays a 5 percent annual…

A: This question require us to calculate the bond's expected rate of return.

Q: ected rate of return concept differ from that of the rea

A: There are many method of valuation of stock based on expected rate and realized return and dividends…

Q: Hana Inc. is considering an investment in new equipment that will be used to manufacture a…

A: Calculate the net income: Selling price per unit $173 Less:Total cost per unit ($152.60) Net…

Q: Expected return and standard deviation a.  What is the expected return of asset​ b?

A: The expected return is the return that an investor expects on its investment under various…

Q: Suppose the risk free rate (rfr) = 5%, average market return (rm) = 10%, and the required or…

A: Expected return = Risk free rate + beta * (market return - risk free rate )

Q: What does the annual effective yield represent?

A: Yield refers to the rate of return that is received by the owner of the security who has invested in…

Q: You own 200 shares of Shapard Resources' preferred stock, which currently sells for $40 per share…

A: In the given question we have two parts: In part (a) we need to compute expected return  In part (b)…

Q: The rate of return on the U.S. government treasury bill is 0.03 and the expected rate of return on…

A: In this question we need to compute the required rate of return for a stock. Required rate of return…

Q: Suppose the market risk premium is 4.0 % and the risk-free interest rate is 3.0%. Use the data below…

A: In this Question we need to compute the expected return of investing in General Electric company. We…

Q: How Broader Diversification Increases Expected Return?

A: The expected return on an investment refers to the weighted average of estimated returns and…

Q: beta value on risk-return ratio

A: The risk-return ratio measures the return in terms of risk for a specified period of time. The…

Q: The following data are accumulated by Geddes Company in evaluating the purchase of $101,200 of…

A: Net present value of investment is computed by subtracting the initial investment from present…

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: A particular stock has a beta of 1.2 and an expected return of 10.2 %. The expected risk premium on…

A: The expected return on market portfolio stock refers to the return that is anticipated on a market…

Q: (Bondholders' expected rate of return) You own a bond that has a par value of $1000 and matures in…

A: In the given question we need to compute the bond's expected rate of return. We can calculate bond's…

Q: Q1 A company is evaluating three possible investments. Each uses the straight-line method of…

A: Computation of Average Investment is as follows: Average investment =Initial value+Salvage…

Q: Drexel Manufacturing (DM) is a leading firm in the creation of environmentally safe containers. DM…

A: Capital budgeting decisions are the one through which we could compare different projects for the…

Q: The the expected return, the the risk. O a. lower; higher O b. higher,lower O c. higher; higher more…

A: Expected return and risk are correlated

Q: PROVIDE - PRESENT VALUE, FUTURE VALUE, AND internal rate of return (IRR)

A: Present and Future Value: The current value of a cash flow that is expected to occur at some time in…

Q: McGilla Golf has decided to sell a new line of golf clubs. The clubs will sell for $815 per set and…

A: NPV is also known as Net Present Value.. It is a capital budgeting technique which helps in decision…

Q: Assume that you make quarterly payments of $650 into an annuity paying 8% interest compounded…

A: In this question we need to calculate the future value from following details: Quarterly payment =…

Q: he longer the time horizon to an investment's maturity, the ________ the expected risk and the…

A: When money is invested in the market there is risk and risk depends on many factors and the return…

Q: Sam Slater buys a $10,000, 13-week Treasury bill at 5 % .What is the effective rate? (Round your…

A: Discount = Value * Rate * time Discount = $10000 * 5.5% * 13 / 52 Discount = $137.50

Q: The management of NUBD Co. is considering the purchase of a new machien costing P400,000 with a…

A: Average rate of return or accounting rate of return is technique in capital budgeting which is used…

Q: 16. Pocket Price: calculate the pocket price for the following product. Suggested Retail Trade…

A: Answer:-  Definition of pocket price:- Pocket price can be defined as the list price which is…

Q: Return on Return on Asset K in Return on State of Probability Asset J in Asset L in Economy of State…

A: Expected return = sum of (probability * return)

Q: What is the expected spot rate?

A: A spot rate is a price quoted for immediate settlement on an interest rate, commodity, security, or…

Q: what is the return on investment in percent?

A: Solution:- Rate of return on investment means the percentage of return on the money invested. So,…

Q: Temp Force recently issued preferred stock that pays an annual dividend of $5 at a price of $50 per…

A: Details given to us are : Annual Dividend = $5 Price per share = $50 We need to compute the expected…

Q: Vaterways puts much emphasis on cash flow when it plans for capital investments. The company chose…

A: Introduction Net Present Value NPV: One of the most preferred techniques of Capital Budgeting, which…

Q: Calculate the expected cost of investment and the standard deviation

A: The cost of investment can be defined as capital requirement for an investment. Expected cost f an…

Q: Consider the three stocks in the following table. P+ represents price at time t, and Qe represents…

A: Rate of return:The “rate of return” is a financial metric that represents the profit or gain…