Problem regarding the market risk premium

Assignment Help Business Management
Reference no: EM131265160

Need help with a quiz. I answered a few questions and need help with the following:

1: In order to fund her retirement, Michele requires a portfolio with an expected return of 0.11 per year over the next 30 years. She has decided to invest in Stocks 1, 2, and 3, with 25 percent in Stock 1, 50 percent in Stock 2, and 25 percent in Stock 3. If Stocks 1 and 2 have expected returns of 0.11 and 0.11 per year, respectively, then what is the minimum expected annual return for Stock 3 that will enable Michele to achieve her investment requirement?

2: Lee purchased a stock one year ago for $25. The stock is now worth $33, and the total return to Lee for owning the stock was 0.36. What is the dollar amount of dividends that he received for owning the stock during the year?

3: The beta of M Simon Inc., stock is 1.5, whereas the risk-free rate of return is 0.10. If the expected return on the market is 0.16, then what is the expected return on M Simon Inc?

4: London purchased a piece of real estate last year for $84,900. The real estate is now worth $103,500. If London needs to have a total return of 0.21 during the year, then what is the dollar amount of income that she needed to have to reach her objective?

5: The risk-free rate of return is currently 0.05, whereas the market risk premium is 0.05. If the beta of RKP, Inc., stock is 1.9, then what is the expected return on RKP?

Reference no: EM131265160

Questions Cloud

Calculate the corresponding stress level in fill and warp : Determine if any kind of failure takes place at this load level (using data from Table 9.5).
Write an information request to a real or fictitious person : Write an information request to a real or fictitious person in a company where you would like to work.-  If you want to start your own business, write to someone who has done it.
Describe the purpose of the paper and provide a conclusion : Describe the purpose of the paper and provide a conclusion. Write clearly and correctly-that is, no poor sentence structure, no spelling and grammar mistakes, and no run-on sentences.
What is the final conclusion of this reasoning : In "a Matter of Direction" in the chess text "Chess Mysteries", why did Holmes rule out that the black king in a8 could have moved from a7 before white made its last move?
Problem regarding the market risk premium : The risk-free rate of return is currently 0.05, whereas the market risk premium is 0.05. If the beta of RKP, Inc., stock is 1.9, then what is the expected return on RKP?
Uses the straight-line method of amortization : Grand Company issued $800,000, 10%, 20-year bonds on January 1, 2014, at 104. Interest is payable annually on January 1. Grand uses the straight-line method of amortization and has a calendar year end. Prepare all journal entries made in 2014 related..
Stock ownership are good incentive plans : Do you think using profit sharing and employee stock ownership are good incentive plans? Defend your answer and discuss.
Prepare an information request with logical questions : Prepare an information request with logical questions about designing, hosting, and maintaining a Web site for a small business.
Training for the better or worse : Do you think technology has changed training for the better or worse? Justify your answer and discuss with your peers.

Reviews

Write a Review

Business Management Questions & Answers

  Answered for the company tesla

Answered for the company Tesla

  Notes of conversation between you and employee

If you are unable to meet in person, you may conduct the meeting virtually by phone or through a Skype call. In a role-play situation, pretend you are the manager and provide feedback on the employee's strengths, weaknesses, and any opportunities ..

  Different integrated marketing tactics

Part 1: Design five (5) different integrated marketing tactics (including graphics and text/copy). The five tactics are as follows:

  Explain when the direct order is appropriate in inquiries

Explain when the direct order is appropriate in inquiries. When would you use the indirect order? Defend your remarks with examples

  Populate a pricing table that includes basic training

Design and populate a Pricing table that includes basic training rate information. Designate the "Technical" field type as "Yes/No"and prepare a query that lists the participants who are only confirmed.

  The american ship building company

The American Ship Building Company (American) operated a shipyard in Chicago, Illinois, where it repaired Great Lakes ships during the winter months, when freezing on the Great Lakes rendered shipping impossible. The workers at the shipyard were repr..

  Long-term stress differentiated

How is long-term stress differentiated from short-term stress in this article? What brain region is involved in this comparison and what is its general function? Insert a labeled picture of this region into your assignment illustrating its locatio..

  Slp intro to cybersecurity and technology

Costs to defend against cyber threats continue to grow as losses mount from cybercrime.  Examples of these crimes include retailers such as Target and Home Depot with the loss credit card information, to Sony related loss of company secrets on fil..

  Employee evaluation processdiscuss the employee evaluation

employee evaluation processdiscuss the employee evaluation process as it exists within your organization or one that

  Melanie and carol conduct a beauty salon business

Melanie and Carol conduct a beauty salon business. Melanie is responsible for performing the beauty treatments and Carol is solely responsible for providing and packaging the beauty products for sale. Polly, a friend of both Melanie and Carol's, agre..

  Index of openness for australia

In 2012, Australia exported goods and services worth $1.84 trillion and imported goods and services worth $2.52 trillion. That resulted in a trade deficit of $0.68 trillion. In the same year, Australian Gross Domestic Product equaled $14.61 trilli..

  Understanding of strategic management

Use your understanding of strategic management to complete the sentence below. When managers engage in a systematic analysis of the organization's internal and external environment

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!

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