which kind of shares would you expect to pay higher average return: shares in an industry that is very sensitive to economic conditions (such as an automaker) or shares in an industry that is relatively insensitive to economic conditions (such as water company)? why?

Q: Economists assert that financial markets serve the function of efficiently allocating capital. What…

A: The stock market, bond market, currency market, and derivatives market are just a few examples of…

Q: "You are interested in buying a piece of real property that could be worth $313,000 in 15 years.…

A: Here, we calculate the given as follow;

Q: What's the value to you of a $1,000 face- value bond with an 8% coupon rate when your required rate…

A: A bond is an instrument being issuer to the holders of indebtedness of the bond.

Q: What are the market information or background of companies found in Philippine Stock Exchange?

A: PSE, Philippine Stock Exchange is the national stock exchange of Philippines. The stock exchange is…

Q: suppose a stock worth $50 today is equally likely to be worth $100 or $25 a year from today. What is…

A: Stock A stock that is also known as equity is a financial instrument that represents the ownership…

Q: How much will a person get when redeeming a bond worth $1,200,000.00 today that will mature in three…

A: Present worth of bond = 1200,000 $ Time = 3 months Bank charges = 4 % per month

Q: rnes Cosmetics Co.'s stock price is $60, and it recently paid a $1.25 dividend. This dividend is…

A: the stock price is $60 recently paid a $1.25 dividend. a dividend is expected to grow by 27% n = 3…

Q: How much would you pay for a perpetual bond that pays an annual coupon of $100 per year and yields…

A: here we calculate the following blanks by using the given information , so the calculation of the…

Q: what would you pay today for a stock that is expected to make $1.50 dividend in one year if the…

A: Economics is a branch of social science that describes and analyzes the behaviors and decisions…

Q: These are managed by firms or companies of mutually-shared funds in order to achieve a given…

A: “Since you have asked multiple questions, we will solve the first question for you. If you want any…

Q: A lottery claims its grand prize is $20 million, payable over four years at $4,000,000 per year. If…

A: We know that,  PV = FV / (1+r)n So, PV of all cash flow of this lottery is, PV = $4,000,000 /…

Q: Discuss the rationale for expecting an efficient capital market. What factor would you look for to…

A: Meaning of Efficient Capital Market: The term efficient capital market refers to the situation…

Q: Suppose X Corp. issued one-year discount bonds with a face value of $5,000 and the bonds were sold…

A: Given,Face value = $5000Discounted value = $4800Interest rates can be calculated as = Face value -…

Q: what is undervalued and overvalued shares? Explain why investor buy undervalued shares and sell over…

A: An investor may take up various investment decisions in order to generate income. This is because…

Q: A company plans to place money in a new venture capital fund that currently returns 13.05% per year,…

A: The effective annual rate gives you the actual return as it reflects the actual annual return of the…

Q: Explain the reasons why non-investment management arrangements (franchising, management contracts)…

A: Multinational hotel corporations, which are frequently integrated with tour operators, travel…

Q: Suppose X Corp. issued one-year discount bonds with a face value of $5,000 and the bonds were sold…

A: Given : Issued bonds =$5000 Sold Bonds=$4800

Q: You are a senior management position in a leading international funds management firm. Your Board of…

A: Markets refer to the place or platform that exists for the purpose of economic transactions. It…

Q: Identify the term being referred to: A type of shares that have priority over ordinary shares

A: The term which depicts a collection of investments being made by the individuals in the financial…

Q: A preferred stock pays an annual dividend of $1.25. What is one share of this stock worth today if…

A: * SOLUTION :-  * Given that ,  The annual devidend = $1.25 The rate of return  = $ 13.5   * Price of…

Q: Explain how shares of stocks differ from mutual funds.

A: A stock (also referred to as equity) is a security reflecting the ownership of a fraction of a…

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: Find the limiting value of Macaulay duration as maturity is increased to infinity of an 8% coupon…

A: Given: Yield = 8% Yield is paid semi-annually

Q: f a coupon bond has two years to​ maturity, a coupon rate of 8​%, a par value of ​$1000​, and a…

A: Answer: Given, Coupon rate = 8% Par value = $1000 Yield to maturity = 12% Calculation:…

Q: Describe one of the simple method that is commonly used to screen capital investments?

A: The payback method is one of the simple methods used for the screening of capital investment before…

Q: What will happen if two assets are earning the same expected return, but one is more risky than the…

A: The uncertainty that may occur in the future is referred to as risk. The minimum profit you obtain…

Q: Joe runs a small boat factory. He can make ten boats per year and sell them for €25,000 each. It…

A: ANSWER   Joe runs a small boat factory. He can make ten boats per year and sell them for €25,000…

Q: What is the current price of a $1,000 discount bond that matures in 5 years if the yield to maturity…

A: As it is given in the question that Time n=5 YTMR = 5% current price =$1,000

Q: What is real property and personal property? Explain the types of tenure and distinguish between…

A: Property is a term that refers to anything that a person or a company has legal title to and that…

Q: Identify the term being referred to: A process wherein new shares are offered to existing…

A: Sone cash trapped companies offer new additional shares in proportion of their existing…

Q: Suppose that if you purchase a share of SuperCo, you will receive an annual dividend of $2.59 next…

A: Answer; Given Annual Dividend= $ 2.59   Approprate Discount Rate = 6.75% 0r 0.0675…

Q: Explain the difference between Initial Margin and Maintenance margin in stock trading.

A: The stock market comprehensively alludes to the assortment of trades and different settings where…

Q: Which of the following $1,000 face-value securities has the highest yield to maturity? A) a 5…

A: option A is correct answer

Q: Find the present value of $750 to be paid four years from now when the prevailing interest rate is…

A: Present value (PV) is the current value of a future sum of money or stream of cash flows given a…

Q: One of the goals of mutual funds is to achieve superior diversification compared to what individual…

A: Economics is a branch of social science that describes and analyzes the behaviors and decisions…

Q: Answer the attached question

A: With rise in stock prices, it is only profitable till shares are sold.

Q: The following table summarizes prices of various default-free zero-coupon bonds (expressed as a…

A: For the three-year Zero coupon bond YTM of 3 year zero coupon = FVPV1n- 1 FV = Face Value = 100 PV =…

Q: FarCry Industries, a maker of telecommunications equipment, has 2 million shares of common stock…

A: A share is the basic unit in which the capital of a company is divided. The people who hold shares…

Q: Rafael invested $2,000 in a business that yields an annual interest rate of 10% compounded…

A: Continuous compounding formula: P(t) = Pert Where P(t) is valued at time t P is invested money (or…

Q: Many retirement funds charge an administrative fee equal to 0.25% on managed assets.  Suppose that…

A: The administrative fee charged by the retirement funds is 0.25 percent which means that the…

Q: What is the difference between these calls? Is there a difference between the prices of these calls?…

A: American (A) and  European(E) are type of Call options which are financial contracts that offer the…

Q: lculate the value of a stock that is expected to pay a constant dividend of $1.05 per year if the…

A: Given Dividend = 1.05 $ constant rate Required return = 11 %

Q: Why would versification over purchasing one stock? Please provide a detailed example.

A: Answer- Versification over purchasing one stock with example- There are many mis conception about…