Question based on the picture attached(b) Explain any three (3) costs and benefits of partnerships/proprietorships as compared to corporation. Give your opinion which type of organizational structure is preferable. The following shows the expected percentage returns on three stocks over the next six years:StockPercentage Return (%)Year2.34A10681215В844.86.49.6121012106.6.Required:(i)(ii)(iii)Find the expected return for each of the stock.Compute the variance and standard deviation for stock A, B and C. Show your working.Justify how can you minimize the risk of the above combination of stocks.

Standard deviation is used to measure the portfolio risk. It is the under root of variance of each…

Answered: The following shows the expected…

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter8: Analysis Of Risk And Return

Section: Chapter Questions

Problem 3P

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Question based on the picture attached

(b) Explain any three (3) costs and benefits of partnerships/proprietorships as compared to corporation. Give your opinion which type of organizational structure is preferable.

The following shows the expected percentage returns on three stocks over the next six years:
Stock
Percentage Return (%)
Year
2.
3
4
A
10
6
8
12
15
В
8
4
4.8
6.4
9.6
12
10
12
10
6.
6.
Required:
(i)
(ii)
(iii)
Find the expected return for each of the stock.
Compute the variance and standard deviation for stock A, B and C. Show your working.
Justify how can you minimize the risk of the above combination of stocks.

Definition Definition Arrangement between two or more people whereby they agree to manage business operations and share its profits and losses in an agreed ratio. The agreement drafted and signed by the partners of the firm is termed as a partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, and drawings of a partner.

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