23-Two stocks each pay a $1 dividend that is growing annually at 4 percent. Stock A's beta = 1.3; stock B's beta = 0.8.
a. Which stock is more volatile?
b. If Treasury bills yield 2 percent and you expect the market to rise by 8 percent, what is your risk-adjusted required return for each stock?
c. Using the dividend-growth model, what is the maximum price you would be willing to pay for each stock?
d. Why are their valuations different?
In: Finance
A statistical program is recommended.
Suppose that the magnitude of earthquakes recorded in a region of North America can be modeled as having a gamma distribution with α = 0.8 and β = 2.6.
(b) What is the probability that the magnitude of an earthquake striking the region will exceed 5 on the Richter scale? (Round your answer to four decimal places.)
(c) Using an exponential distribution with mean 2.6 to model the magnitude of an earthquake striking the region, the probability an earthquake will exceed a magnitude of 5 is 0.1462. Is this probability larger or smaller than the probability found in (b)? Explain.
In: Statistics and Probability
Suppose that the price of gold at close of trading yesterday was $600 and its volatility was estimated as 1.3% per day. The price at the close of trading today is $605. Moreover, the price of silver at the close of trading yesterday was $16, its volatility was estimated as 1.5% per day, and its correlation with gold was estimated as 0.8. The price of sliver at the close of trading today is unchanged at $16. a. Update the volatilities for gold and silver using the EWMA model with λ = 0.94. b. Update the correlation between gold and sliver using the EWMA model with λ = 0.94.
In: Finance
A machine is producing metal pieces that are cylindrical in shape. A sample of 12 pieces is taken and the diameters are: 1.01, 0.97, 1.03, 1.04, 0.8, 0.78, 1.06, 0.95, 0.87,1.0,0.88 and 0.90 centimeters.
a. Find 98% confidence interval for the true average diameter of metal pieces produced by the machine.
We would like to test whether the true average diameter of metal pieces produced by the machine is less than 1 centimeter.
b. Assuming the population distribution is approximately normal and using level of significance ? = 0.05, carry out a hypothesis test.
In: Statistics and Probability
The summary of the payroll for the monthly pay period ending December 15 indicated the following
|
Sales salaries |
$165,000 |
|
Federal income tax withheld |
32,300 |
|
Office salaries |
34,000 |
|
Medical insurance withheld |
14,370 |
|
Social security tax withheld |
12,200 |
|
Medicare tax withheld |
4,550 |
Journalize the entries to record (a) the payroll and (b) the employer's payroll tax expense for the month. The state unemployment tax rate is 3.1%, and the federal unemployment tax rate is 0.8%. Only $30,000 of salaries are subject to unemployment taxes.
This is to be done in Excel.
Thanks!! :)
In: Accounting
8.
A sample of 400 observations will be taken from an infinite population. The population proportion equals 0.8. The probability that the sample proportion will be greater than 0.83 is
Select one:
a. 0.4332
b. 0.0668
c. 0.9332
d. 0.5668
9.
Four hundred people were asked whether gun laws should be more stringent. Three hundred said "yes," and 100 said "no". The point estimate of the proportion in the population who will respond "yes" is
Select one:
a. 300
b. approximately 300
c. 0.75
d. 0.25
In: Math
The number of hits to a website follows a Poisson process. Hits occur at the rate of 0.8 per minute between 7:00 P.M. and 9:00 P.M. Given below are three scenarios for the number of hits to the website. Compute the probability of each scenario between 8:39 P.M. and 8:47 P.M. Interpret each result.
(a) exactly seven P(7)=
(Round to four decimal places as needed.)
(b) fewer than seven
(c) at least seven
(Round to four decimal places as needed.)
In: Math
2.A n+400-k VA, 2300+n- 230+n-v, 60-hz transformer supplies a 0.8 lagging power-factor load whose KVA Is adjustable from no load to 120 percent rated KVA. The percent resistance, percent reactance, and percent core loss are m+1.56, m+3.16, and m+0.42 respectively. For 2 KVA increments of load, tabulate and plot the efficiency of the transformer from no load to 120 percent rated load. Use Matlab
n=20
m=.2
In: Electrical Engineering
A steam turbine operates with steam at inlet conditions of 3.5 MPa and 3500 C. The exit stream leave the turbine is at 0.8 MPa and is known to contain a mixture of saturated vapor and liquid. The steam rate through the turbine is 1000 kg/h. A (negligible) fraction of exit stream is bled through a throttle valve to 0.10 MPa and is found to be 1250 C. The measured output of the turbine is 100 kW.
a) Determine the temperature and quality of the exit stream.
b) Determine the rate of heat transfer into or out of the turbine during its operation.
In: Mechanical Engineering
The following data is given for a horizontal highway
curve having 2 lanes with Lane width of 3.65 m each: Ruling design
speed is 110kmph, Allowable rate of change of circular acceleration
= 0.5 to 0.8. Allowable rate of introduction of super-elevation = 1
in 144, Take maximum allowable superelevation and lateral
frictional co-efficient is 0.15.
Calculate the length of a transition curve for following cases.
Rate of change of centrifugal acceleration
(C).
Rate of introduction of super-elevation.
Using empirical equations for plain and mountainous
terrain.
In: Civil Engineering