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worty [1.4K]
2 years ago
14

Thayer Farms stock has a beta of 1.38. The risk-free rate of return is 3.87 percent, the inflation rate is 3.93 percent, and the

market risk premium is 9.03 percent. What is the expected rate of return on this stock?
Business
1 answer:
meriva2 years ago
8 0

Answer: 16.33%

Explanation:

With the details given, the best method of Calculating the expected rate of return is the Capital Asset Pricing Model (CAPM).

The formula is,

Er = Rf + b(Rm - Rf)

Where,

Er is expected return

Rf is the risk free rate

b is beta

Rm - Rf is the Market Premium

Er = 3.87% + 1.38(9.03)

= 3.87% + 12.4614%

= 16.33%

The model accounts for inflation by including the risk free rate which is already adjusted for inflation.

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Joel was recently hired as a police officer in his city's police department. As part of employee training, his supervisor trains
Assoli18 [71]

Answer:

On-the job training.

Explanation:

This is explained to be normal emphasized training that working staffs are seen to undergo; especially newly employed staffs, which is a direct training while doing the actual job they are been hired or paid for. A a good and reasonable trainee in this aspect is seen to be appreciative when given this chance to develop knowledge and skills without ever leaving work. In this employee training format, employees are seen to receive your workplace needs, norms, and culture and familiarize with them. Internal job training and employee development bring a special plus. This is why in the scenario above, Joel's supervisor trains him off-site on the use of firearms.

3 0
2 years ago
A leader high in initiating structure is most likely to​ ________.
olya-2409 [2.1K]

A leader who is high in initiating structure is most likely to engage to the following;

<span>·         </span>When it comes to deadlines, the leader most likely emphasizes the meeting of this deadlines

<span>·         </span>The leader is likely to expect from its workers the standards of their performance to be maintained

7 0
2 years ago
The Porch Cushion Company manufactures foam cushions. The number of cushions to be produced in the upcoming three months​ follow
Eddi Din [679]

Answer:

16,900

Explanation:

Ending Inventory = 30% x 12,000 = 3,600

Beginning Inventory = 30% x 19,000 =5,700

Thus;

19,000 + 3,600 – 5,700 = 16,900

Therefore the Porch Cushion Company need to purchase in​ August,900 pound of foam of Cushion.

5 0
2 years ago
You are considering the following two mutually exclusive projects. The required rate of return is 14.6 percent for project A and
Lyrx [107]

Answer:

b. project A; because its NPV is about $4,900 more than the NPV of project B

Explanation:

Net present value is the Net value all cash inflows and outflows in present value term. All the cash flows are discounted using a required rate of return.

Mutually exclusive projects are those projects where only one project is selected for investment after analysis. NPV is the most preferred method in the evaluation of mutually exclusive projects for capital budgeting. That project is accepted which has higher positive NPV.

Net present value of Project A =$13,157.24

Net present value of Project A =$8,256.98

Difference = $13,157.24 - $8,256.98 = $4,900.26

Net Present value working is made in MS Excel File which is attached with this answer, please find it.

Download xlsx
6 0
2 years ago
A construction firm cannot obtain the necessary permits to begin building a shopping mall until it can show it either has or wil
olga_2 [115]

Loan commitment or credit line.

Answer: Options II or III.

<u>Explanation:</u>

A loan advancement is a bank's guarantee to offer an advance or credit of a predefined sum to a borrower. Likewise called a dedication letter, it incorporates the entirety of the terms and states of the credit.  

A credit line is the measure of cash that can be charged to a Mastercard account. The size of a credit line, and its amount has been obtained, impact purchaser FICO assessments. Low credit usage — that is, a credit line on which little has been obtained — prompts a higher FICO rating.

8 0
2 years ago
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