What is the difference between YTD and YoY return? Provide an example

Q: What is the carryover ratio? What parameters of the base does its value depend on?

A: Carryover Ratio The purpose of measuring the carryover ratio  is to determine the ratio which are…

Q: are the major assumptions made by economic order quantity (EOQ) model?

A: Step 1 Economic order quantity (EOQ) is the ideal order quantity a company should purchase to…

Q: How is ARR calculated?

A: ARR: Accounting Rate of Return (ARR) is the rate of return earned on the investment made in a…

Q: A) What is VAT? what is the difference between input and output VAT?

A: Comment - We’ll answer the first question since the exact one wasn’t specified. Please submit a new…

Q: Compute the percentage total return. C

A: The method of finding the intrinsic value of the stock of a company is called stock valuation.…

Q: Why is partitioning an internal rate of return important?

A: Introduction: There are two cash flow components which can form the portioning of internal rate of…

Q: What can be understood by abnormal return?

A: Note firstly we understand what is meaning of abnormal return. Basic meaning of abnormal return is…

Q: Define each of the following terms: d. Modified internal rate of return (MIRR) method

A: Modified Internal Rate of Return (MIRR): The modified internal rate of return (MIRR) method…

Q: Set out and explain the function of the p/e ratio

A: P/E ratio is a vital valuation ratio used in relative valuation methods. The function of pe ratio…

Q: Can you have an investment with DCFRR > MARR, but NPV < $0 (calculating NPV with iry=MARR)?

A: 1. The first investment is not profitable  2. The second investment is profitable 3. The third…

Q: Which of the following is true about rates?

A: Total Rate of Return: The total rate is the real rate of return made on an investment over a period…

Q: How to obtain Gradient to equal-payment conversion? Note that A=G(A/G) formula F=P(1+i)^N ,…

A: The Gradient Arithmetic Worth is an important concept that determines the present value, annual…

Q: What is indifference curve?

A: Indifference curve: It is a diagram indicating a mix of two items that give equivalent fulfillment…

Q: What is meant by the term abnormal rate of return?

A: Abnormal rate of return is return earned above or below the normal rate of return.

Q: find The internal rate of return (IRR) for this case in exceland equation.

A: Internal rate of return(IRR) is the rate at which the the initial cost of project is equal to…

Q: What is the Decreasing Returns to Scale? Can you please explain and give a definition, thank you.

A: The concept of decreasing return to scale is majorly used in production process and production…

Q: Is an higher NPV better than a lower NPV and why?

A: The net present value is the difference between sums of the present value of cash inflows and…

Q: What is the Internal-Rate-of-Return Criterion?

A: Internal rate of return (IRR): The internal rate of return (IRR) is a measure utilized in capital…

Q: What is R, the expected

A: The time value of money is a method to calculate the present value and future value of an…

Q: What is the difference between I and G spread measures?

A: The yield spread of the bond reflects the difference between the YTM(Yield to Maturity) of various…

Q: Define average return

A: The formula to compute average return as follows:

Q: The difference between the expected return and the actual return is referred to as the unexpected…

A: The excess amount over invested value that an investor estimates to realize over horizon of…

Q: What is the P/D ratio? How can it be improved?

A: P/D ratio is more accurate way for anticipating what is really required. P/D ratio compares the…

Q: Compare the mutually exclusive alternatives based on the rate of return?

A: Mutually exclusive projects are the projects out of which one best project is selected due to lack…

Q: impact the price of MYR?

A: MYR: MYR refers to the Malaysian Ringgit. It is the currency used in Malaysia. The value of 1 MYR is…

Q: What is the difference between arithmetic and geometric mean returns?

A: The difference between arithmetic mean return and geometric mean return is mainly in two aspects…

Q: Explain the relationship between the conventionaL PW criterion and the B/C ratio?

A: The relationship between the cost of the project and benefits earned from the project is measured by…

Q: What is the discount factor?

A: Discount factor, also known as the conversion factor refers to the value which is used to calculate…

Q: What is net present value (NPV) method?

A: Capital budgeting can be defined as the decision making process employed by businesses wherein, a…

Q: What is disbursal rate

A: Disbursal rate is an important concept in the realm of financial markets and in the realm of fintech…

Q: The expectations gap is

A: The Answer :

Q: Describe the Incremental B/C-Ratio Analysis?

A: Benefit cost analysis: Benefit cost analysis refers to analyzing the desirability of project where…

Q: What does the quick ratio measure?

A: Ratio Analysis is a financial tool used to derive conclusions about the company’s health and overall…

Q: Explain an example of net realizable value.

A: Net realizable value:   Net realizable value is the net amount of receivables which a business…

Q: Explain arithmetic mean returns?

A: Arithmetic mean:It is a commonly used measure of  mean (or measure of average). Arithmetic mean is…

Q: Define Net profi t margin

A: Net Profit Margin is calculated by dividing Net Profit by Revenue. It is a financial ratio used to…

Q: What is Modified Internal Rate of Return (MIRR) method?

A: Internal rate of return (IRR): The internal rate of return (IRR) is a measure utilized in capital…

Q: What is ‘Fixed’ APR and ‘Variable’ APR?

A: APR is percentage  Annual rate of interest  charged on credit cards or mortgages or loans.

Q: What is Net Present Value (NPV)?

A: Time value of money: Time value of money refers to the concept that the value of money available at…

Q: Distinguish between Current ratio and Quick ratio?

A: Ratio analysis: It refers to the quantitative technique of financial analysis that allows gaining an…

Q: solvency ratios

A: Solvency ratio indicates the company's ability to pay off its debt obligation.

Q: Another term for return is ..................

A: Return means money which is earned or lost in the process of investment. Return  can be in the form…

Risk and return

Before understanding the concept of Risk and Return in Financial Management, understanding the two-concept Risk and return individually is necessary. 

Capital Asset Pricing Model

Capital asset pricing model, also known as CAPM, shows the relationship between the expected return of the investment and the market at risk. This concept is basically used particularly in the case of stocks or shares. It is also used across finance for pricing assets that have higher risk identity and for evaluating the expected returns for the assets given the risk of those assets and also the cost of capital.