State of Economy Bust Boom Security Returns if Probability of State, State Occurs of Economy Roll 0.30 0.70 -10% 27 Ross 20% 7 Calculate the expected returns for Roll and Ross by filling in the following table: Note: A negative value should be indicated by a minus sign. Do not round intermediate calculations. Calculate the product using the decimal value of the probability and the percentage value of the return. Input all your answers as a percent rounded to 2 decimal places. Roll Ross Bust State of Economy Probability of State of Economy 0.30 Return if State Occurs Product Return if State Occurs Product -10% % 20 % % Boom 0.70 27 % % 7% % E(R) = 15.90 % E(R) = 10.90 %

Q: PR 12-4

A: Date Particulars Debit Amount Credit Amount 30-Jun Asset revaluation  $2,900     Accounts…

Q: E12.10 (b)

A: Total issued and outstanding shares = 95000+25000+2000 = 122,000 shares Dividend declared on dec. 15…

Q: Bnmm

A: Accounting system refers to the set of the processes of accounting which is integrated with the…

Q: please explain 120/360

A: Solution: Interest amount is computed using formula = Principal * Interest rate * time Where time is…

Q: P12.2 (c)

A: Ending Retained Earnings  = Beginning Retained Earnings  + Net income - dividend declared…

Q: E11.18

A: Annual Interest on Bonds = Face value of bonds x rate of interest x year = 2400000*7%*1 year  =…

Q: Concord Corporation's charter authorized issuance of 96,000 shares of $10 par value common stock and…

A: The company issues either common shares or preferred shares. When the company issues these shares…

Q: When are data in 3NF?

A:

Q: the customer per small p the customer per large p= s Stork Enterprises have f gnize this tax…

A: A. Total tax charged to the customer per small package = 6% x $45 = $2.70Overall charge per small…

Q: 1,352,113.13 is incorrect. What is the correct answer?

A: Net Present Value is used to evaluate the investment and financing decisions that involve cash flows…

Q: spatial distances

A: Spatial distance is actually the length of the path or straight line distance between two points. In…

Q: anuty What general internal control v

A: Given case is: All-Around Sound Co. discovered a fraud whereby one of its front office…

Q: Explanation 1031 like-kind exchange

A:

Q: Carefully explain the cross-sectional test of the CAPM.

A: The Capital Asset Pricing Model (CAPM) is a mathematical model that describes the relationship…

Q: Which basis of measurement is allowed in standard IFRS16?

A: IFRS or International Financial Reporting Standards are the guidelines of accounting given by the…

Q: E14.3 (b)

A: The cash flow statement is helpful for the stakeholders as they can identify the organization's…

Q: practical issues of wacc

A: Every entity uses a mix of equity and debt to fund its operations. This mix is recognized as the…

Q: What is MM Proposition I?

A: Modigliani and Miller’s approach is an element of economic theory and it forms the basis for modern…

Q: 17. What are the key features of ERISA?

A: The Employee Retirement Income Security Act of 1974 (ERISA) is a federal statute that provides basic…

Q: So the answer is  1394 or2450?

A: The deductible business expenses are the expenses which are incurred for business. If the expenses…

Q: What the agi

A: AGI means Adjusted Gross Income. It is the total income on which income tax payable would be…

Q: Define regulation D

A: The Accounting Standards are specific set of principles and procedures set by the authorized bodies…

Q: Section 1250 summary

A: Section 1250 of the United States Internal Revenue Code is a rule wherein IRS will tax a gain from…

Risk and return

Before understanding the concept of Risk and Return in Financial Management, understanding the two-concept Risk and return individually is necessary. 

Capital Asset Pricing Model

Capital asset pricing model, also known as CAPM, shows the relationship between the expected return of the investment and the market at risk. This concept is basically used particularly in the case of stocks or shares. It is also used across finance for pricing assets that have higher risk identity and for evaluating the expected returns for the assets given the risk of those assets and also the cost of capital.