Business, 05.11.2019 04:31 dommalb

Assume that in recent years, both expected inflation and the market risk premium (rm ? rrf) have declined. assume also that all stocks have positive betas. which of the following would be most likely to have occurred as a result of these changes? a. the average required return on the market, rm, has remained constant, but the required returns have fallen for stocks that have betas greater than 1.0.b. the required returns on all stocks have fallen by the same amount. c. the required returns on all stocks have fallen, but the decline has been greater for stocks with higher betas. d. the required returns on all stocks have fallen, but the decline has been greater for stocks with lower betas. e. the required returns have increased for stocks with betas greater than 1.0 but have declined for stocks with betas less than 1.0.

Answers: 1

Show answers

Another question on Business

Business, 21.06.2019 18:10

Classifying inflows and outflows of cash classify each of the following items as an inflow (i) or an outflow (o) of cash, or as neither (n). lg 2 lg 2 item change ($) item change ($) cash +100 accounts receivable −700 accounts payable −1,000 net profits +600 notes payable +500 depreciation +100 long-term debt −2,000 repurchase of stock +600 inventory +200 cash dividends +800 fixed assets +400 sale of stock +1,000

Answers: 1

Answer

Business, 22.06.2019 16:50

Andrea cujoli is a currency speculator who enjoys "betting" on changes in the foreign currency exchange market. currently the spot price for the japanese yen is ¥129.87/$ and the 6-month forward rate is ¥128.53/$. andrea would earn a higher rate of return by buying yen and a forward contract than if she had invested her money in 6-month us treasury securities at an annual rate of 2.50%. true/false?

Answers: 2

Answer

Business, 22.06.2019 17:40

Take it all away has a cost of equity of 11.11 percent, a pretax cost of debt of 5.36 percent, and a tax rate of 40 percent. the company's capital structure consists of 67 percent debt on a book value basis, but debt is 33 percent of the company's value on a market value basis. what is the company's wacc

Answers: 2

Answer

Business, 22.06.2019 20:00

After testing its water, a city water department issues a report to the related citizens, noting what chemicals have been identified, their doses, and the estimated risks of exposure at these levels. this report represents a type of

Answers: 1

Answer

You know the right answer?

Assume that in recent years, both expected inflation and the market risk premium (rm ? rrf) have de...

Questions

Business, 19.07.2021 20:00

On January 1, 2018, Tonge Industries had outstanding 800,000 common shares ($1 par) that originally sold for $20 per share, and 3,000 shares of 10% cu...