What is the Sharpe ratio of the best feasible CAL?

Q: What is an acceptable current ratio?

A: Definition: Ratio analysis: It is the financial analysis tool for measuring the profitability,…

Q: How do the Internal-Rate-of-Return Criterion relate to the PW Analysis?

A: Capital budgeting:   It is the process in which the business uses to determine which proposed fixed…

Q: How to compute the PV Factor?

A: The PV factor allows you to discount a future value to a present value. The formula to determine the…

Q: what are the three probability ratios equations?

A: Ratio Analysis - The ratio is the technique used by the prospective investor or an individual or…

Q: What is one interpretation of a high P/E ratio?

A: Price to earnings ratio (P/E ratio) states the relationship of the earnings with price of that…

Q: What is a yield curve, and what information would you need todraw this curve?

A: Yield curve: It could be a line plotting bond yields (coupon rates) of comparative credit quality…

Q: What are the advantages of the scattergraph method over the high-low method? Thehigh-low method over…

A: Introduction: Cost accounting is beneficial since it can demonstrate where a corporation spends…

Q: How do you calculate a weighted beta?

A: In portfolio there are number of stock present in portfolio. We have to calculate weight of each…

Q: What are solvency ratios and what do they measure?

A: Solvency ratios of the company indicates that whether cash flows of the company are sufficient to…

Q: What alternative approaches can be used to estimate variable consideration?

A: The alternative approaches that can be used to estimate variable consideration are: Expected value…

Q: What is the Decreasing Returns to Scale? Can you please explain and give a definition, thank you.

A: The concept of decreasing return to scale is majorly used in production process and production…

Q: How do we calculate the quick ratio?

A: Quick ratio: Categorized under liquidity ratio  Quick ratio which helps company to know the it's…

Q: How efficient is an High-low method technique?

A: Using high low method, different types of costs can be separated.

Q: Is an higher NPV better than a lower NPV and why?

A: The net present value is the difference between sums of the present value of cash inflows and…

Q: What is the difference between the possible returns and the expected return?

A:

Q: Define average return

A: The formula to compute average return as follows:

Q: What does a high current ratio indicate?

A: Current ratio: The financial ratio which evaluates the ability of a company to pay off the debt…

Q: List several potential problems with ratio analysis.

A: Ratio analysis is a correlation of details in an organization's financial reports. It is utilized to…

Q: Define the Sortino ratio and explain its advantage

A: Ratio analysis is referred to as the quantitative method for gaining an insight with relate to the…

Q: how did you find the margin ratio?

A: A margin ratio is a financial metric that measures the % of profit generated from an entity's…

Q: How to estimate the Residual Value?

A: Residual value means value of fixed asset left after the use of fixed assets. Residual value also…

Q: What is Altman's Z-score and what does it tell you?

A: The Altman Z Score is utilized to forecast the probability that a business will go bankrupt inside…

Q: Is a negative Sharpe ratio good or bad?  EXPLAIN

A: What sharpe ratio measure? It measure the excess return earn by portfolio over risk free rate at…

Q: how do I calculate the PV factor?

A: PV factor is the present value of future cash flow of $1 after n years.

Q: an you describe with examples of the advantages and disadvantages of ratio analysis?

A: Ratio Analysis: Ratio analysis is a financial metric used by financial managers for analyzing and…

Q: Give an example of a Sensitivity Analysis performed for Mutually Exclusive Alternatives?

A: Mutually exclusive alternatives are those alternatives out of which only one can be selected at a…

Q: Describe the Methods for Finding Rate of Return?

A: Capital budgeting is the process a company follows to decide whether to purchase a fixed asset or…

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: The expectations gap is

A: The Answer :

Q: What are some examples of variable consideration? What are the two approaches for estimating…

A: Variable consideration: It is an amount which is included in the contract as consideration. An…

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.