What is the difference between return of and return on investment and what is the expected...
What is the difference between return of and return on investment and what is the expected rate of return?
Homework Answers
rate of returen - A rate of return is the gain or loss on an investment over a specified period, expressed as a percentage increase over the initial investment cost.
return on investment - ROI measures the amount of returnon an investment relative to the investment’s cost.
expected rate of return - The expected rate of return is the return on investment that an investor anticipates receiving. It is calculated by estimating the probability of a full range of returns on an investment, with the probabilities summing to 100%.
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What is the difference between return of and return on
investment and what is the expected...
Explain the difference between the interest rate used in an investment and the rate of return...
Explain the difference between the interest rate used in an investment and the rate of return of the investment. What is the relationship between IRR and MARR? When costs equal benefits (during the same time) what is the present value of the investment? Define rate of return analysis List one advantage of rate of return analysis
Explain the difference between the required rate of return and the expected rate of return. When...
Explain the difference between the required rate of return and the expected rate of return. When comparing the required rate of return to the expected rate of return, when would we purchase the stock (i.e., when the required rate is <,>, or = to the expected rate)?
#1 and #3 Define holding period return. What is the difference between required return and expected...
#1 and #3
Define holding period return. What is the difference between required return and expected return? Evaluate this expression, "If risk is increased two-fold, then the required retun should increase Ost, the expression er of assets in the portio ts of assets in the portil 4 Describe the difference between the correlation coefficient betwem t asset's beta coefficient. two-fold." e higher levels of risk milarly, the portfoli's and B. Lastly, a porti PAPEREMATE WHITE BR
Investment A has a beta of 1.7 and an expected rate of return of 15.7%. Investment...
Investment A has a beta of 1.7 and an expected rate of return of 15.7%. Investment B has a beta of 0.8 and an expected rate of return of 10.2%. What is the equity premium (market risk premium)?
Assume there are no investment projects in the economy that yield an expected rate of return...
Assume there are no investment projects in the economy that
yield an expected rate of return of 25 percent or more. But suppose
there are $10 billion of investment projects yielding expected
returns of at least 20 percent; another $10 billion yielding at
least 15 percent; another $10 billion yielding at least 10 percent;
and so forth.
a. Draw this relationship between the expected rate of return and the amount of investment expenditure. Instructions: Use the tool provided 'ID' to...
What is the relationship between Return On Investment and Current Ratio ? What is the relationship between Return On In...
What is the relationship between Return On Investment and Current Ratio ? What is the relationship between Return On Investment and Operating margin ? -- Return on Investment (ROI) is a Dependent Variable Current Ratio and Operating margin are Independent Variables
What is the internal rate of return on a $37,000 investment that is expected to yield...
What is the internal rate of return on a $37,000 investment that is expected to yield $9,000 in cash flows over a six-year period?
Assume there are no investment projects in the economy that yield an expected rate of return...
Assume there are no investment projects in the economy that yield an expected rate of return of 25 percent or more. But suppose there are $10 billion of investment projects yielding expected returns of at least 20 percent; another $10 billion yielding at least 15 percent; another $10 billion yielding at least 10 percent, and so forth a. Draw this relationship between the expected rate of return and the amount of investment expenditure Instructions: Use the tool provided 'ID' to...
A. SHORT QUESTIONS 1. What is the internal rate of return? 2. What is the difference...
A. SHORT QUESTIONS 1. What is the internal rate of return? 2. What is the difference between real and nominal interest rates? 3. What is risk and how to measure it? 4. What is the difference between idiosyncratic and systematic risk? 5. What is hedging? 6. Explain how diversification can be used to reduce risk. B. ANALYTICAL QUESTIONS QUESTION 1 Consider two investment alternatives, investment I and investment II, with their payoffs and their associated probabilities outlined in the following...
What is the present worth difference between an investment of $35,000 per year for 50 years and an investment of $35,000...
What is the present worth difference between an investment of $35,000 per year for 50 years and an investment of $35,000 per year forever at an interest rate of 9% per year? The difference is determined to be $_______.
#1 and #3
Define holding period return. What is the difference between required return and expected return? Evaluate this expression, "If risk is increased two-fold, then the required retun should increase Ost, the expression er of assets in the portio ts of assets in the portil 4 Describe the difference between the correlation coefficient betwem t asset's beta coefficient. two-fold." e higher levels of risk milarly, the portfoli's and B. Lastly, a porti PAPEREMATE WHITE BR
Assume there are no investment projects in the economy that
yield an expected rate of return of 25 percent or more. But suppose
there are $10 billion of investment projects yielding expected
returns of at least 20 percent; another $10 billion yielding at
least 15 percent; another $10 billion yielding at least 10 percent;
and so forth.
a. Draw this relationship between the expected rate of return and the amount of investment expenditure. Instructions: Use the tool provided 'ID' to...
Assume there are no investment projects in the economy that yield an expected rate of return of 25 percent or more. But suppose there are $10 billion of investment projects yielding expected returns of at least 20 percent; another $10 billion yielding at least 15 percent; another $10 billion yielding at least 10 percent, and so forth a. Draw this relationship between the expected rate of return and the amount of investment expenditure Instructions: Use the tool provided 'ID' to...
A. SHORT QUESTIONS 1. What is the internal rate of return? 2. What is the difference between real and nominal interest rates? 3. What is risk and how to measure it? 4. What is the difference between idiosyncratic and systematic risk? 5. What is hedging? 6. Explain how diversification can be used to reduce risk. B. ANALYTICAL QUESTIONS QUESTION 1 Consider two investment alternatives, investment I and investment II, with their payoffs and their associated probabilities outlined in the following...
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