Table 6-1. Actual Sales Data Time Actual Period Sales 345 378 425 4 450 470 6. 500 7 532 8. 548 9 590 10 625 11 650
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.
Please refer to the attached image.
Here is the question: Using the exponential smothing model with an alpha of 0.2 and a smoothed
Forecast by using Exponential smoothing is calculated by using the following formula:
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