Answer: a. 11.5%
Explanation:
Fad followers are those investors who follow a trend when it emerges and as such their betas will be less than that of informed traders because the informed traders would have acted first.
Using the Capital Asset Pricing Model to calculate expected return.
Er = Rf + b( Rm - Rf)
Er = Expected return
Rf = Risk Free Rate
b = Beta
Rm = Market Return.
The Expected Return for the Informed Investors is,
= 4% + 1.4 ( 10% - 4%)
= 4% + 1.4 ( 6%)
= 12.4%
With the Fad followed expected to have a lower beta and therefore a lower expected return than the Informed Investors, the only suitable option is the 11.5%.
Answer:
EOQ: 80
order per year: 10
Explanation:
We need to solve for the Economic Order Quantity:
Where:
D = annual demand = 800
S= setup cost = ordering cost = 16
H= Holding Cost = 4
EOQ = 80
Orders per year = 800 demand/ 80 order size= 10
When weighing your employment options, these are very important to consider:
- Employee Benefits
- Pay period
- Taxes taxable income.
Thus, all of these are very important to consider before accepting the job offer.
200,000 have to find what 10 percent is and multiply that by 10
Answer: $80
Explanation:
Opportunity cost is the benefit that is foregone for an individual by choosing one alternative over other alternatives available to him.
If the opportunity cost is lower for an individual then this will benefit him whereas if the opportunity cost is higher then this will not benefit the individuals.
The opportunity cost of writing a term paper is $80 that she values by going out with a friend and it is the higher cost alternative.
