8 percent return on investment
[DOC File]Chapter 7 12
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Mar 09, 2010 · 8. The Treasury bill rate is 4 percent, and the expected return on the market portfolio is 12 percent. Using the capital asset pricing model: b. What is the risk premium on the market? Market risk premium = rm – rf = 0.12 – 0.04 = 0.08 = 8.0%. c. What is the required return on an investment with a beta of 1.5? Using the security market line:
CHAPTER 1
(b) 10 Someone in the 15 percent tax bracket can earn 8 percent on his investments in a . tax-exempt IRA account. What will be the value of a $10,000 investment after 5 . years (assuming annual compounding)? $ 6,805. $14,693. $15,528. $20,114. $50,000 (c) 11 Suppose the 8 percent investment of the previous problem is taxable rather than. tax ...
[DOCX File]CHAPTER 8
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At an 8 percent required return, the NPV is positive, so we would accept the project. The equation for the NPV of the project at a 24 percent required return is: NPV = – $8,900 + $2,150(PVIFA 24 %, 9 )
[DOC File]CHAPTER 10: Responsibility Accounting
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The company's minimum required rate of return is 12 percent. Return on investment for Durand is. a. 9.0%. b. 18.3%. c. 20.8%. d. 27.7%. d 50. Durand Division has the following results for the year: Revenues $470,000. Net income 130,000. Total divisional assets are $625,000. The company's minimum required rate of return is 12 percent.
[DOC File]Exam-type questions
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27. A highly risk-averse investor is considering the addition of an asset to a 10-stock portfolio. The two securities under consideration both have an expected return, , equal to 15 percent. However, the distribution of possible returns associated with Asset A has a standard deviation of 12 percent, while Asset B’s standard deviation is 8 ...
[DOC File]c
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e. 8.30 percent. d 2. A stock had returns of 8 percent, -2 percent, 4 percent, and 16 percent over the past four years. What is the standard deviation of this stock for the past four years? a. 6.3 percent. b. 6.6 percent. c. 7.1 percent. d. 7.5 percent. e. 7.9 percent. c 3. If the economy booms, RTF, Inc. stock is expected to return 10 percent.
[DOC File]Risk and Return - Florida Gulf Coast University
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For example, assume that the risk-free rate is 6 percent, and the market risk premium is 5 percent. If the company’s beta doubles from 0.8 to 1.6 its expected return increases from 10 percent to 14 percent. Therefore, in general, a company’s expected return will not double when its beta doubles. 2-7 Yes, if the portfolio’s beta is equal ...
[DOC File]Chapter Fifteen - University of Nevada, Reno
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The remaining $100 million was invested in a one-year Brazilian government bond paying an annual interest rate of 8 percent. The exchange rate at the time of the transaction was Brazilian real 1/$. a. What will be the net return on this $200 million investment in bonds if the exchange rate between the Brazilian real and the U.S. dollar remains ...
Chapter 20
The expected return for the market is 12 percent, with a standard deviation of 20 percent. The expected risk-free rate is 8 percent. Information is available for three …
[DOC File]CHAPTER 8
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Investment Opportunity Rate of Return. Municipal Bonds 0.095. High Tech Stock 0.146. Blue Chip Stock 0.075. Federal Bonds 0.070. The Board of Directors has mandated that at least 60 percent of the investment consist of a combination of municipal and federal bonds, 25 percent Blue Chip Stock, and no more than 15 percent High Tech Stock.
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