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Since the question is an MCQ Based question, answer is provided directly as not explanation is asked specifically.
Answer 11 - Bank E
Answer 12 - C $ 7.34
Answer 13 - Answer C
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11. Since a small company is hard to finance and earn money, a government used to...
Since a small company is hard to finance and earn money, a government used to implement...
Since a small company is hard to finance and earn money, a government used to implement various policy of Inclusive finance to support their operations. In order to support this policy, each bank provide special borrowing rate for small companies to finance. The borrowing rate is 3% annually compounding, 2.6% semiannually compounding, 2.8% quarterly compounding, 1.5% semiannual rate, 0.75% quarterly rate for Bank A, Bank B, Bank C, Bank D, and Bank E respectively. Which bank will support mostly the...
Problem 11. [4 pts] Emily DiDonato is thinking of buying Berkshire Hathaway Inc. (BRK-B) priced at...
Problem 11. [4 pts] Emily DiDonato is thinking of buying Berkshire Hathaway Inc. (BRK-B) priced at $200 per share. She assumes that that risk-free rate is about 5% and the market risk premium (MRP) is 10%. If she thinks, the stock will rise to $320 per share by the end of the year, what beta would it need to have for this expectation to be consistent with the CAPM? (Show your calculations) Problem 12. 4 pts] Taylor Hill wants to...
A stock has a beta of 1.14 and an expected return of 10.5 percent. A risk...
A stock has a beta of 1.14 and an expected return of 10.5
percent. A risk free asset currently early 2.4 percent.
a. What is the expected return on a portfolio that is equally
invested in the two assets?
b. If a portfolio of the two assets has a beta of .92, what are
the portfolio weights?
c. If a portfolio of the two assets has an expected return of 9
percent, what is its beta?
d. If a portfolio...
2. You have $200,000 to invest in Stock D, Stock E, and a risk-free asset. You must invest all of your money. Your...
2. You have $200,000 to invest in Stock D, Stock E, and a risk-free asset. You must invest all of your money. Your goal is to create a portfolio that has an expected return of 15 percent If D has an expected return of 18 percent and a beta of 1.50, E has an expected return of 15.2 percent and a beta of 1.15, and the risk-free rate is 6 percent, and if you invest $60,000 in Stock D, how...
2. You have $200,000 to invest in Stock D, Stock E, and a risk-free asset. You...
2. You have $200,000 to invest in Stock D, Stock E, and a risk-free asset. You must invest all of your money. Your goal is to create a portfolio that has an expected return of 15 percent If D has an expected return of 18 percent and a beta of 1.50, E has an expected return of 15.2 percent and a beta of 1.15, and the risk-free rate is 6 percent, and if you invest $60,000 in Stock D, how...
Tom has $10,000. He can invest the money in (1) a corporate bond, (2) a stock,...
Tom has $10,000. He can invest the money in (1) a corporate bond, (2) a stock, and (3) the risk-free T-bill. The table below provides these assets’ expected returns and standard deviations: Bond (D) Stock (E) T-Bill (F) Expected Return 5% 10% 2% Standard Deviation 10% 20% 0 The coefficient of correlation between the corporate bond and the stock (ρDE) is 30%. Tom has a risk aversion coefficient of A=5. To construct the optimal portfolio with two risky assets and...
Portfolio return and beta Personal Finance Problem Jamie Peters invested $106,000 to set up the following...
Portfolio return and beta Personal Finance Problem Jamie Peters invested $106,000 to set up the following portfolio one year ago: E a. Calculate the portfolio beta on the basis of the original cost figures. b. Calculate the percentage return of each asset in the portfolio for the year. C. Calculate the percentage return of the portfolio on the basis of original cost, using income and gains during the year. d. At the time Jamie made his investments, investors were estimating...
Portfolio return and beta Personal Finance Problem Jamie Peters invested $117,000 to set up the following...
Portfolio return and beta Personal Finance Problem Jamie Peters invested $117,000 to set up the following portfolio one year ago: a. Calculate the portfolio beta on the basis of the original cost figures. b. Calculate the percentage return of each asset in the portfolio for the year. c. Calculate the percentage return of the portfolio on the basis of original cost, using income and gains during the year. d. At the time Jamie made his investments, investors were estimating that...
please answer both parts thankyou ! 1)Suppose you are the money manager of a $3.68 million...
please answer both parts thankyou ! 1)Suppose you are the money manager of a $3.68 million investment fund. The fund consists of four stocks with the following investments and betas: Stock Investment Beta A $ 540,000 1.50 B 500,000 (0.50) C 940,000 1.25 D 1,700,000 0.75 If the market's required rate of return is 8% and the risk-free rate is 4%, what is the fund's required rate of return? Do not round intermediate calculations. Round your answer to two decimal...
2. You have $200,000 to invest in Stock D, Stock E, and a risk-free asset. You...
2. You have $200,000 to invest in Stock D, Stock E, and a risk-free asset. You must invest all of your money. Your goal is to create a portfolio that has an expected return of 15 percent If D has an expected return of 18 percent and a beta of 1.50, E has an expected return of 15.2 percent and a beta of 1.15, and the risk-free rate is 6 percent, and if you invest $60,000 in Stock D, how...
Problem 11. [4 pts] Emily DiDonato is thinking of buying Berkshire Hathaway Inc. (BRK-B) priced at $200 per share. She assumes that that risk-free rate is about 5% and the market risk premium (MRP) is 10%. If she thinks, the stock will rise to $320 per share by the end of the year, what beta would it need to have for this expectation to be consistent with the CAPM? (Show your calculations) Problem 12. 4 pts] Taylor Hill wants to...
A stock has a beta of 1.14 and an expected return of 10.5
percent. A risk free asset currently early 2.4 percent.
a. What is the expected return on a portfolio that is equally
invested in the two assets?
b. If a portfolio of the two assets has a beta of .92, what are
the portfolio weights?
c. If a portfolio of the two assets has an expected return of 9
percent, what is its beta?
d. If a portfolio...
2. You have $200,000 to invest in Stock D, Stock E, and a risk-free asset. You must invest all of your money. Your goal is to create a portfolio that has an expected return of 15 percent If D has an expected return of 18 percent and a beta of 1.50, E has an expected return of 15.2 percent and a beta of 1.15, and the risk-free rate is 6 percent, and if you invest $60,000 in Stock D, how...
2. You have $200,000 to invest in Stock D, Stock E, and a risk-free asset. You must invest all of your money. Your goal is to create a portfolio that has an expected return of 15 percent If D has an expected return of 18 percent and a beta of 1.50, E has an expected return of 15.2 percent and a beta of 1.15, and the risk-free rate is 6 percent, and if you invest $60,000 in Stock D, how...
Portfolio return and beta Personal Finance Problem Jamie Peters invested $106,000 to set up the following portfolio one year ago: E a. Calculate the portfolio beta on the basis of the original cost figures. b. Calculate the percentage return of each asset in the portfolio for the year. C. Calculate the percentage return of the portfolio on the basis of original cost, using income and gains during the year. d. At the time Jamie made his investments, investors were estimating...
2. You have $200,000 to invest in Stock D, Stock E, and a risk-free asset. You must invest all of your money. Your goal is to create a portfolio that has an expected return of 15 percent If D has an expected return of 18 percent and a beta of 1.50, E has an expected return of 15.2 percent and a beta of 1.15, and the risk-free rate is 6 percent, and if you invest $60,000 in Stock D, how...
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