discuss efficient portfolios and what information they can provide

Q: What is the relationship between risk and return in finance? Why does this relationship hold in the…

A: A return refers to the additional net revenue received from the investment. Risk refers to the…

Q: The National Pension Fund pays no taxes on its capital gains or on its dividend and interest income.…

A: According to the given question, The National Pension Fund is a firm that does not pay taxes on its…

Q: How Forecasting plays an important role in stock market?

A: Forecasting plays an important role in stock market. Forecasting the future changes in stock market…

Q: How does risk sharing benefit both financial intermediaries and private investors?

A: Risk-sharing - risk sharing is a method of sharing risk between the participants.

Q: List three benefits of portfolio capital....

A: A portfolio can be defined as a collection of financial or investment assets that individuals, hedge…

Q: Compare credit, savings, and investment services available to the consumer from financial…

A: Financial institutions, which include lenders, financial agencies, insurers, and securities dealers,…

Q: When interest rates decrease, how might businesses andconsumers change their economic behavior?

A: The interest rate is the rate charged by the lender on the asset lend by them. The asset lend can be…

Q: At what point in one’s life is it safest to try a risky investment?  Closer to or further from…

A: Its safest to try risky investment when you are further from retirement.

Q: Investors must go for investments that are liquid to ensure availability of funds when needed.  Is…

A: Liquidity is defined as the ability to exchange assets for cash. The more easier it is to convert an…

Q: What are some examples of financial assets? Rank these examples in order of their risk.

A: A financial asset refers to the liquid assets that get their value from a contractual right or…

Q: Why is it hard to forecast future movements in stock prices?

A: Stock prices: The stock prices are the current prices that a share of a stock is trading in the…

Q: Given two portfolios, one portfolio has a higher sharpe ratio than the other. Explain what this…

A: A portfolio with higher sharpe ratio is considered superior than the portfolio with lower sharpe…

Q: Explain why emerging market economies is important in financial markets?

A: Financial markets represent the marketplace in which the buyers and sellers trade various financial…

Q: based on the utility curves

A: An optimal portfolio is one which either tends to minimize your risk for a given return level or…

Q: What is an investment pool?

A: Investment pools are the funds collected from individual investors or public entities. These funds…

Q: Why might an investor prefer to invest indirectly rather than directly?

A: Direct or indirect investment both leads to pay offs, it depends on the investor about what is…

Q: compare and contrast the three portfolio management theories:  a) Modern Portfolio Theory by…

A: Modern Portfolio Theory Modern portfolio theory is a realistic strategy for picking investment with…

Q: Why do most investors hold diversified portfolios?

A: "Don't put all your eggs in one basket" This adage very well captures all the essence of…

Q: What are some of the major differences between common stock and preferred stock

A: A stock (sometimes called equity) is a financial instrument that represents ownership of a share of…

Q: What might cause interest rates to be low one year and high the next?

A: Interest rates are best thought of as the "cost of money." If a borrower wishes to spend more money…

Q: Why are bonds somewhat risky to buy, even though they make predetermined payments based on a fixed…

A: Financial economics deals with the financial markets, their operations and functions, and the…

Q: Should a person who is risk-averse hold a portfolio with no stock and only bonds? Explain.

A: Equity investment is volatile and a person may lose all his money in a particular stock if the…

Q: What are the most liquid assets?

A: A liquid asset is that type of asset which can be easily converted into cash in a very short period…

Q: The benefit of diversification when constructing a portfolio is that it can reduce what?

A: Diversification(D) is a strategy to minimize the risk by combining variety of investments(I) within…

Q: How might the magnitude of the market risk premium impact someone's desire to buy stocks?

A: A risk premium is the projected investment return on an asset that is higher than the risk-free rate…

Q: What effect might a fall in stock prices have on businessinvestment?

A: Stock prices are a price at which the stock is being exchanged in the stock market. Stock market is…

Q: What is Tesla Inc. in 2018 all about?

A: Introduction Elon Musk, Tesla's Chairman and CEO, tweeted on August 7, 2018, that he was…

Q: How the time based term effects interest rates and its yield curve?

A: A yield curve is a graph that compares the yields (interest rates) of bonds with similar credit…

Q: Explain the bond markets in the real world.

A: A bond is an advance that the bond buyer, or bondholder, makes to the bond backer. Governments,…

Q: There’s no penalty for withdrawing funds from investments before they mature. True or false

A: When a depositor withdraws funds or closes out a time deposit before the maturity date, an early…

Q: Explain what is meant by ESG and the advantages and disadvantages of using ESG considerations when…

A: ESG stands for Environmental, Social, and Governance factors that are increasingly used by investors…

Q: How do public pension plans differ in other countries? Has privatization worked overseas?

A: The market value of final products and services produced within the economy within a certain time…

Q: If interest rates increase in financial markets, then...

A: Interest rates are defined as the charges taken by the lenders for the money lent ti the borrower.…

Q: What does the risk structure of interest rates measure? Is the current structure of U.S. rates…

A: (Q) What does the risk structure of interest rates measure? Is the current structure of U.S. rates…

Q: Explain Net-Present-Worth Criterion?

A: The net- present-worth criterion is a very important and useful method to evaluate investment…

Q: Explain how the following transactions affect Bangladeshi NCO? Does this transaction affect direct…

A: i.) Pran Foods Ltd. buys stock in Amul India Private Ltd. Since Pran food ltd. is a company of…

Q: Provide 4 economic reasons as to why portfolio rankings should be inconsistent or consistent with…

A: Portfolio Ranking is a heart of Project Portfolio Management (PPM). A strong project portfolio…

Q: seven major financial institutions

A: Financial institutions today help the economy to lend, distribute and borrow money for various…

Q: How will your analysis assist you in determining the direction of the stock market?

A: The macroeconomics also include several factors for study of the stock market. To have a prescient…

Q: Explain how the following transactions affect Bangladeshi NCO? Does this transaction affect direct…

A: Ans: 1) Since Pran food ltd. is an organization of Bangladeshi origin and situated in Bangladesh, so…