What are the advantages or disadvantages of Fama-French 5-factors in comparison with Fama-Frech 3-factors that was developed in 1993

Q: What does the following sentence mean? "It is critical to define your product while considering the…

A: "It is critical to define your items before taking into consideration the responses of rivals."When…

Q: Caribu Company produces sanitation products after processing specialized chemicals; The following…

A: Joint cost allocation: Sales value at split-off method: Total sales value at split-off = (400grams…

Q: What are the advantages and disadvantages of  FIFO?

A: First-in-First-Out:  In First-in-First-Out method, the costs of the initially purchased items are…

Q: Which of the following is an expected advantage of implementing IFRS?

A: International Financial Reporting Standards, also known as IFRS, basically represents the standards…

Q: What is the current approach embraced by standard setters in measurement and write its advantages…

A: Measurement is the manner of determining the quantitative values at which items of financial…

Q: Which of following is a disadvantage of outsourcing

A: “The deliberate use of outside services to conduct tasks typically performed by internal personnel…

Q: Are these good advantages and disadvantages about RRSP’s? What can I include and remove?

A: RRSP or registered retirement savings plan is a retirement savings plan for employees and self…

Q: Why are the Rule of 70 and the ratio scale useful tools? How do they worktogether?

A: THE RULE 70 The Rule of 70  is the method to ascertain the time period or the number of years it…

Q: How do the FCFE, corporate FCF valuation, and compressed APV models differ? How are they similar?

A: FCFE stands for free cash flow to equity, FCF indicates free cash flow to the firm and APV refers to…

Q: Whta is the advantages and disadvantages of Wakala – Mudharabah (Hybrid) Model in takaful?

A: Wakala: Wakala is an agency contract in which the account holder (principal) hires an Islamic…

Q: MCMC and autocorrelation related to each other? If related, then what are the disadvantages…

A: GIVEN     MCMC and autocorrelation related to each other? If related, then what are the…

Q: What are the advantages and disadvantages of  LIFO?

A: Last-in-First-Out: In Last-in-First Out method, the costs of last purchased items are considered as…

Q: If so many companies find non-GAAP calculationsuseful when communicating with their stakeholders,…

A: GAAP is a set of rules for efficiently capturing and interpreting accounting data. GAAP standards…

Q: Decentralisation has both costs and benefits. What are some reasons why organisations may choose to…

A: Decentralization: Decentralization can be defined as the practice of assigning the responsibility…

Q: What is the financial advantage (disadvantage) of further processing each of the three products…

A: Split-off Point: Split-off point is the point in production process where joint products are capable…

Q: Why DuPont Analysis is important?

A: DuPont analysis is a Analysis of the Components which makes the Return on equity. So its breaks the…

Q: Fs n were part of a N

A: Formula to calculate PV of cash flows is: PV = FV/(1+r)^n Formula to calculate NPV is: NPV = cash…

Q: or working for NPV and EAA calculation?

A: EAA is calculated as shown below. EAA=NPV×r1-11+rnHere,Cost of capital/ WACC=rLife of project=n

Q: What assumptions can stembiso change to improve the numbers?

A: There are several assumptions that Sthembiso could change to potentially improve the numbers for the…

Q: Why are comparative ratio analyses useful?

A: Financial analysis can be defined as the evaluation of the profitability, durability and feasibility…

Q: What three global factors affect Raytheon's (RTX) performance? Why?

A: Raytheon Technologies Corporation is the American corporation, which is a defense conglomerate as…

Q: What are representative strengths of NPO?

A: Non Profit Organisations (NPO) are expected to be driven by a need to fulfill a social purpose…

Q: What are the benefits and drawbacks of FIFO?

A: Introduction: First-in-First-Out:  In First-in-First-Out method, the costs of the initially…

Q: Summarize Fama and French’s findings from their five-factor model. Compare this new model with the…

A: Fama-French factor models are financial models used to explain and predict stock returns based on…

Q: What is ROE, ROA, and The DuPont Formula?

A: Ratio analysis is a part of management accounting in which different types of ratios are determined…

Q: Sergo Games Sergo Games produced action video games, one of which sold more than 700,000 copies last…

A: Particulars In-house production Outsourcing Units produced 20,00,000 20,00,000 Direct cost…

Q: Why did Fama and French introduce three-factor model in place of CAPM?

A: Fama fench model addresses the shortcomings of the Capital asset pricing model.

Financial Ratios

A Ratio refers to a figure calculated as a reference to the relationship of two or more numbers and can be expressed as a fraction, proportion, percentage, or the number of times. When the number is determined by taking two accounting numbers derived from the financial statements, it is termed as the accounting ratio.

Return on Equity

The Return on Equity (RoE) is a measure of the profitability of a business concerning the funds by its stockholders/shareholders. ROE is a metric used generally to determine how well the company utilizes its funds provided by the equity shareholders.