The risk free rate is 4 determine the expected return and

Assignment Help Finance Basics
Reference no: EM13618007

Consider two risky securities X and Y displaying the following information:

Security                                              X       Y

Expected return                               0.10   0.15

Standard deviation                          0.18   0.25

Correlation Coefficient between

Securities X and Y                               0.7

The risk free rate is 4%. Determine the expected return and variance of return for a portfolio that is composed of 30 percent of security X, 50 percent of security Y, and 20 percent of risk-free assets.

Reference no: EM13618007

Questions Cloud

A parallel-plate capacitor is connected to a battery the : a parallel-plate capacitor is connected to a battery. the energy of the capacitor is . the capacitor is then
The cfo for the stockton company is considering proposals : the cfo for the stockton company is considering proposals to invest in two mutually exclusive projects. project a
What is the null hypothesis what is the research hypothesis : a researcher wants to know if there was a difference between urban and rural jurisdictions in the hiring of female
Compute the desities of totally crystalline and totally : the density and associated percent crysallinity for two nylon 66 materials are shown as follows compute the desities of
The risk free rate is 4 determine the expected return and : consider two risky securities x and y displaying the following
Metric chain what is metric : what is metric chain
Wheatstone manufacturing normally spends 500000 per year on : wheatstone manufacturing normally spends 500000 per year on regularly scheduled preventive maintenance for the
The aurora is caused when electrons and protons moving in : the aurora is caused when electrons and protons moving in the earths magnetic field of 5x10-5 t collide with molecules
Assume that the anova assumptions are verified state the : assume that the anova assumptions are verified. state the rejection rule to test whether the population mean differs

Reviews

Write a Review

Finance Basics Questions & Answers

  Compute the present value of a perpetuity that pays 12961

compute the present value of a perpetuity that pays 12961 annually given a required rate of return of 10 percent per

  Importance of financial statement footnotes

Would investors say that footnotes are important to the financial statements?  Explain.

  What is the us dollar cost to hp of buying £50 million

Suppose HP receives quotes of ¥122.330-38 for the US dollar and ¥238.240-54 for pound.

  Procedure of loan amortization also capital recovery

Illustrate procedure of loan amortization also capital recovery through suitable example.

  Calculate the incremental tax savings

A company is planning the replacement of an asset bought three years ago at a cost of $100,000. Under MACRS, the asset was in five year recovery period class.

  Explain decision making on the basis of the irr and npv

Explain decision making on the basis of the IRR and NPV criterion and Compute the net present value for each project if the firm has a 10% cost of capital. Which project should be adopted

  How is a present value associated with risk

How can you explain the fact that as the discount rate increases, the present value of a cash flow decreases? Why do I value a cash flow less, when discount rate goes up? How is a present value associated with risk?

  Ccomputation of annual interest charges for a given degree

Computation of Annual interest charges for a given degree of combined leverage and a lowered degree of combined leverage.

  Should raphael make the purchase

The machine will produce 1,500soufflés per year, with each costing $2.30 to make and priced at $4.75. Assume that the discount rate is 14 percent and the tax rate is 34 percent.

  Explain what are the key benefits of a company investing

explain what are the key benefits of a company investing and trading securities and suggest potential benefits of

  The firms marginal tax rate is 40 percent if the firm

two years ago agro inc. purchased an ace generator that cost 250000. agro had to pay an additional 50000 for delivery

  What are qs eps and dividends next year how will eps and

company qs current return on equity roe is 14. it pays out one-half of earnings as cash dividends payout ratio .5.

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