User Account

All Pages

Calculate the return in percent for each value

Assignment Help Finance Basics
Reference no: EM131143507

Suppose that a security costs $3000 today and pays off some amount b in one year. suppose that b is uncertain according to the following table of probabilities.

B________$3000_____$3300__________$3600________$3900________$4200

Probability 0.1_______0.2_____________0.3__________0.2__________0.2

A. Calculate the return (in Percent) for each value of b. (note: you may just calculate the total return and not worry about how this split between current yield and capital- gains yield)

B. Calculate the expected return (in Percent)

C. Calculate the standard deviation of the return

D. Suppose that an investor has choice between buying this security or purchasing a different security that also cost $3000 today but pays off $3300 with certainty in one year. How is an investor's choice of which security to purchase related to his degree of risk aversion

Reference no: EM131143507

Questions Cloud

Describing using three different social media platforms : Write a 350- to 700-word summary describing using three different social media platforms with the objective of networking within your career field. Use your current social media accounts, or create new ones. Incorporate research regarding how to p..
How are devices are vulnerable to hacking : Based on the TED talks video on " How are devices are vulnerable to hacking", the presenter goes into an overview on how various technology like Pace Makers, vehicles, and radios are susceptible to attack.
Is there connection between ethical behavior : Is there a connection between ethical behavior within an organization and its chances of long-term survivability? Do you think that a company that behaves ethically is less or more likely to make more profit?
Determine the end area graphically by counting squares : From the following excerpt of field notes, plot the cross section on graph paper and superimpose on it a design template for a 30-ft-wide level roadbed with fill slopes of 2-1/2:1 and a subgrade elevation at centerline of 970.30 ft. Determine the ..
Calculate the return in percent for each value : Calculate the return (in Percent) for each value of b. (note: you may just calculate the total return and not worry about how this split between current yield and capital- gains yield). Calculate the expected return (in Percent)
Discuss his beliefs and their influence upon modern society : Nietzsche's ideas attacked Western society's beliefs about morality, religion, and the existence of absolute truth. Discuss his beliefs and their influence upon modern society. Prof Kim (ONLY)
What is peter pretax cost of debt : Peter, Inc., is trying to determine its cost of debt. The firm has a debt issue outstanding with seven years to maturity that is quoted at 108 percent of face value. The issue makes semiannual payments and has an embedded cost of 7.4 percent annually..
Make a presentation powerpoint for public economics : Make a presentation PowerPoint for public economics. - Use a very good design i.e. elemental slide in preparing presentation.
How much was the free cash flow of apple computers : Based on the financial statements given in the upcoming worksheets, how much was the Free Cash Flow of Apple Computers for the year ending September 2014?

Reviews

Write a Review

Finance Basics Questions & Answers

  How much must the monthly savings be under these conditions

The effective monthly interest rate earned on their savings is .45%. How much must the monthly savings be under these conditions?

  Calculate npv of the loan

A small business is receiving a 5 year $1,000,000 loan at a subsidized rate of 3% per year. The firm will pay 3 percent annual interest payment each year and the principal at the end of 5 years.

  Write an explanation to liz discussing the debt structure

Write an explanation to Liz discussing the debt structure of Target and why Tom thinks Target is risky. Be sure to explain clearly what information appears on financial statements

  A very small countrys gross domestic product is 12 million

a very small countrys gross domestic product is 12 million. a. if government expenditures amount to 7.5 million and

  Determine the fundamental manner

Determine the fundamental manner in which this knowledge could be helpful to a financial manager

  Calculation of effective interest rate of foreign currency

Calculation of effective interest rate of foreign currency loan due to changes in exchange rates

  Locate the yield curve chart in the wall street journal

Assume your instructor has two bonds in his portfolio. Both have face values of $1,000 and pay a 10% annual coupon rate. Bond L (longer maturity) matures in 15 years and Bond S (shorter maturity) matures in 1 year

  Which of the following is not a valid quantitative measure

1 as a general rule it is desirable to finance the permanent assets including permanent current assets with long-term

  A two-year zero-coupon treasury bond with a maturity value

a two-year zero-coupon treasury bond with a maturity value of 1000 has a price of 873.4387. a one-year zero-coupon

  Use algebraic and graphical approaches

Mop and Broom Manufacturing is estimating whether to produce a new type of mop. The corporation is planning the operations requirements for the mop as well as the market potential.

  Are there any conflicts between the goals of the investor

As an investor what are the benefits and ramifications of purchasing convertible debt in a publicly traded company? Are there any conflicts between the goals of the investor and the goals of the corporation?

  Raising fund for company

A company has raised $80 million from selling stocks. It wants to take part in a venture that requires $40 million this year, its annual after tax cash flow over the next seven years will be only $325,000.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd