Questions
In a closed economy, given the following: The consumption function C = 0.8(1 – 0.25) Y...

In a closed economy, given the following:

The consumption function C = 0.8(1 – 0.25) Y + 12          

The average tax rate t = 25%

The level of private investment I = 26

The level of government spending G = 14

Where Y is the national income.

  • Calculate the equilibrium level of income and output in the economy.
  • Calculate the expenditure multiplier and show the effect of
  1. an increase in government spending and
  2. an increase in private investment.

Given the short run production function, Q = 3L2 – 0.1L3

( a) Write down the equations for,

(i) the marginal product of labor, MPL

(ii) the average product of labor, APL.

(b) Find the value of Q for which the MPL and APL are maximized.

(c) Show that the MPL= APL when the APL is at a maximum

In: Economics

Stock X has a 9.5% expected return, a beta coefficient of 0.8, and a 40% standard...

Stock X has a 9.5% expected return, a beta coefficient of 0.8, and a 40% standard deviation of expected returns. Stock Y has a 12.0% expected return, a beta coefficient of 1.1, and a 25% standard deviation. The risk-free rate is 6%, and the market risk premium is 5%.

  1. Calculate each stock's coefficient of variation. Do not round intermediate calculations. Round your answers to two decimal places.

    CVx =

    CVy =

  2. Which stock is riskier for a diversified investor?
    1. For diversified investors the relevant risk is measured by beta. Therefore, the stock with the lower beta is riskier. Stock X has the lower beta so it is riskier than Stock Y.
    2. For diversified investors the relevant risk is measured by standard deviation of expected returns. Therefore, the stock with the lower standard deviation of expected returns is riskier. Stock Y has the lower standard deviation so it is riskier than Stock X.
    3. For diversified investors the relevant risk is measured by beta. Therefore, the stock with the higher beta is less risky. Stock Y has the higher beta so it is less risky than Stock X.
    4. For diversified investors the relevant risk is measured by beta. Therefore, the stock with the higher beta is riskier. Stock Y has the higher beta so it is riskier than Stock X.
    5. For diversified investors the relevant risk is measured by standard deviation of expected returns. Therefore, the stock with the higher standard deviation of expected returns is riskier. Stock X has the higher standard deviation so it is riskier than Stock Y.
  3. Calculate each stock's required rate of return. Round your answers to one decimal place.

    rx =   %

    ry =   %

  4. On the basis of the two stocks' expected and required returns, which stock would be more attractive to a diversified investor?

    -Select-Stock XStock YItem 6

  5. Calculate the required return of a portfolio that has $9,000 invested in Stock X and $3,000 invested in Stock Y. Do not round intermediate calculations. Round your answer to two decimal places.

    rp =   %

  6. If the market risk premium increased to 6%, which of the two stocks would have the larger increase in its required return?

In: Finance

An average of 0.8 accident occur per day in a particular large city. Let x be...

An average of 0.8 accident occur per day in a particular large city. Let x be the number of accidents per day. What is the probability, rounded to the nearest 4 decimal places, that no accident will occur in this city on a given day?

What is the probability, rounded to the nearest 4 decimal places, that one or two accidents will occur in this city on a given day?

A really bad carton of 18 eggs contains 7 spoiled eggs. An unsuspecting chef picks 4 eggs at random for this "Mega-Omelet Surprise". Let x be the number of unspoiled eggs in a sample of 4 eggs. Find the probability that the number of unspoiled eggs among the 4 selected is at least 1. Round your answer to the nearest 4 decimal places.

What are all the possible values that x can assume.

In: Statistics and Probability

Stock X has a 9.5% expected return, a beta coefficient of 0.8, and a 30% standard...

Stock X has a 9.5% expected return, a beta coefficient of 0.8, and a 30% standard deviation of expected returns. Stock Y has a 13.0% expected return, a beta coefficient of 1.3, and a 30.0% standard deviation. The risk-free rate is 6%, and the market risk premium is 5%.

A. Calculate each stock's coefficient of variation. Round your answers to two decimal places. Do not round intermediate calculations.

CVx =

CVy =

B. Which of the following stock is riskier for a diversified investor?

a. For diversified investors the relevant risk is measured by beta. Therefore, the stock with the higher beta is less risky. Stock Y has the higher beta so it is less risky than Stock X.

b. For diversified investors the relevant risk is measured by beta. Therefore, the stock with the higher beta is more risky. Stock Y has the higher beta so it is more risky than Stock X.

c. For diversified investors the relevant risk is measured by standard deviation of expected returns. Therefore, the stock with the higher standard deviation of expected returns is more risky. Stock X has the higher standard deviation so it is more risky than Stock Y.

d. For diversified investors the relevant risk is measured by beta. Therefore, the stock with the lower beta is more risky. Stock X has the lower beta so it is more risky than Stock Y.

e. For diversified investors the relevant risk is measured by standard deviation of expected returns. Therefore, the stock with the lower standard deviation of expected returns is more risky. Stock Y has the lower standard deviation so it is more risky than Stock X.

C. Calculate each stock's required rate of return. Round your answers to two decimal places.

rx =

ry =

D. On the basis of the two stocks' expected and required returns, which stock would be more attractive to a diversified investor?

E. Calculate the required return of a portfolio that has $3,500 invested in Stock X and $9,000 invested in Stock Y. Do not round intermediate calculations. Round your answer to two decimal places.

rp =

F.If the market risk premium increased to 6%, which of the two stocks would have the larger increase in its required return

In: Finance

Stock X has a 9.5% expected return, a beta coefficient of 0.8, and a 40% standard...

Stock X has a 9.5% expected return, a beta coefficient of 0.8, and a 40% standard deviation of expected returns. Stock Y has a 12.0% expected return, a beta coefficient of 1.1, and a 30.0% standard deviation. The risk-free rate is 6%, and the market risk premium is 5%. The data has been collected in the Microsoft Excel Online file below. Open the spreadsheet and perform the required analysis to answer the questions below.

Open spreadsheet

  1. Calculate each stock's coefficient of variation. Round your answers to two decimal places. Do not round intermediate calculations.

    CVx =

    CVy =

  2. Which stock is riskier for a diversified investor?

    1. For diversified investors the relevant risk is measured by beta. Therefore, the stock with the higher beta is more risky. Stock Y has the higher beta so it is more risky than Stock X.
    2. For diversified investors the relevant risk is measured by standard deviation of expected returns. Therefore, the stock with the higher standard deviation of expected returns is more risky. Stock X has the higher standard deviation so it is more risky than Stock Y.
    3. For diversified investors the relevant risk is measured by beta. Therefore, the stock with the lower beta is more risky. Stock X has the lower beta so it is more risky than Stock Y.
    4. For diversified investors the relevant risk is measured by standard deviation of expected returns. Therefore, the stock with the lower standard deviation of expected returns is more risky. Stock Y has the lower standard deviation so it is more risky than Stock X.
    5. For diversified investors the relevant risk is measured by beta. Therefore, the stock with the higher beta is less risky. Stock Y has the higher beta so it is less risky than Stock X.

    _____IIIIIIIVV
  3. Calculate each stock's required rate of return. Round your answers to two decimal places.

    rx = %

    ry = %

  4. On the basis of the two stocks' expected and required returns, which stock would be more attractive to a diversified investor?

    _________Stock XStock Y

  5. Calculate the required return of a portfolio that has $4,000 invested in Stock X and $3,000 invested in Stock Y. Do not round intermediate calculations. Round your answer to two decimal places.

    rp = %

  6. If the market risk premium increased to 6%, which of the two stocks would have the larger increase in its required return?

    _________Stock XStock Y

In: Finance

Beta of Assets A, B, C, and D are 1.2, 1.8, 2.4, and 0.8 respectively. You...

Beta of Assets A, B, C, and D are 1.2, 1.8, 2.4, and 0.8 respectively. You form a portfolio with equal weights on A, B, C, and D. The risk-free rate is 2%, and the expected return of the market portfolio is 10%. Find out the expected return of your portfolio according to the CAPM.

Group of answer choices

12%

12.4%

18.2%

17.5%

14.4.%

In: Finance

Stock X has a 9.5% expected return, a beta coefficient of 0.8, and a 40% standard...

Stock X has a 9.5% expected return, a beta coefficient of 0.8, and a 40% standard deviation of expected returns. Stock Y has a 13.0% expected return, a beta coefficient of 1.3, and a 30.0% standard deviation. The risk-free rate is 6%, and the market risk premium is 5%.

  1. Calculate each stock's coefficient of variation. Round your answers to two decimal places. Do not round intermediate calculations.

    CVx =

    CVy =

  2. Which stock is riskier for a diversified investor?

    1. For diversified investors the relevant risk is measured by standard deviation of expected returns. Therefore, the stock with the higher standard deviation of expected returns is more risky. Stock X has the higher standard deviation so it is more risky than Stock Y.
    2. For diversified investors the relevant risk is measured by beta. Therefore, the stock with the lower beta is more risky. Stock X has the lower beta so it is more risky than Stock Y.
    3. For diversified investors the relevant risk is measured by standard deviation of expected returns. Therefore, the stock with the lower standard deviation of expected returns is more risky. Stock Y has the lower standard deviation so it is more risky than Stock X.
    4. For diversified investors the relevant risk is measured by beta. Therefore, the stock with the higher beta is less risky. Stock Y has the higher beta so it is less risky than Stock X.
    5. For diversified investors the relevant risk is measured by beta. Therefore, the stock with the higher beta is more risky. Stock Y has the higher beta so it is more risky than Stock X.
    -Select-IIIIIIIVVItem 3
  3. Calculate each stock's required rate of return. Round your answers to two decimal places.

    rx =  %

    ry =  %

  4. On the basis of the two stocks' expected and required returns, which stock would be more attractive to a diversified investor?
    -Select-Stock XStock YItem 6
  5. Calculate the required return of a portfolio that has $5,000 invested in Stock X and $10,000 invested in Stock Y. Do not round intermediate calculations. Round your answer to two decimal places.

    rp =  %
  6. If the market risk premium increased to 6%, which of the two stocks would have the larger increase in its required return?

In: Finance

Trower Co has a debt to equity ratio 0.8. The co is considering a new plant...

Trower Co has a debt to equity ratio 0.8. The co is considering a new plant cost $115 million to build. flotation cost 8.5%, flotation cost of new debt 4%.
A. What is initial cost of the plant if the co raises all equity externally?
B. What is initial cost of the plant if co uses 55% retained earnings?
C. What is initial cost of plant of co uses 100% retained earnings?

In: Accounting

Two parallel connected loads take a total of 2.4 kW, with a 0.8 line delay at...

Two parallel connected loads take a total of 2.4 kW, with a 0.8 line delay at 120 Vrms and 60 Hz. One load absorbs 1.5 kW with a fp delay of 0.707.
Determine:
a) The fp of the second charge
b) The parallel element required to correct the fp of the two loads and convert it to a delay of 0.9

In: Electrical Engineering

question should be done on Matlab 4) Find the derivative of sin(2x) at x = 0.8...

question should be done on Matlab

4) Find the derivative of sin(2x) at x = 0.8 rad and find the value of h where the error is minimum as compared to the true value i.e. actual value or accurate value. a) Use for loop b) Use element by element operation

In: Computer Science