Principles of Corporate Finance Chapter 11 Exam Bank Solution Manual (Already Passed)
2 views 0 purchase
Course
Principles of Corporate Finance Chapter 11
Institution
Principles Of Corporate Finance Chapter 11
Principles of Corporate Finance Chapter 11 Exam Bank Solution Manual (Already Passed)
The Dow Jones Industrial Average is: - Answers an index of 30 major industrial stocks
Although several stock indexes are available to inform investors of market changes, the Dow Jones Industrial Average: - Answe...
Principles of Corporate Finance Chapter 11 Exam Bank Solution Manual (Already Passed)
The Dow Jones Industrial Average is: - Answers an index of 30 major industrial stocks
Although several stock indexes are available to inform investors of market changes, the Dow Jones
Industrial Average: - Answers is one of the best-known of the U.S. market indexes.
How is it possible for real rates of return to increase during times when the rate of inflation increases? -
Answers Nominal returns increased more than inflation.
Over the past 3 years an investment returned 18%, −12%, and 15%. What is the variance of returns? -
Answers 182
Stock A has an expected return of 15%; Stock B has an expected return of 8%. What is the expected
return on a portfolio that is comprised of 60% of Stock A and 40% of Stock B? - Answers 12.2%
Real rates of return are typically less than nominal rates of return due to: - Answers inflation.
Calculate the variance of returns for Alpha stock with the following historical rates of return:
2018: 20%
2019: 25%
2020: 30% - Answers 16.67
A project's expected return is 15%, which represents a 35% return in a boom and a 5% return in a
stagnant economy. What is the probability of a boom if these are the only two economic states? -
Answers 33.33%
If inflation is 6%, what real rate of return is earned by an investor in a bond that was purchased for
$1,000, has an annual coupon of 8%, and was sold at the end of the year for $960? - Answers −1.89%
Which one of the following security classes has the highest standard deviation of returns? - Answers
Common stocks
The higher the standard deviation of a stock's returns, the: - Answers wider the dispersion of those
returns over time.
A stock is expected to return 11% in a normal economy, return 19% if the economy booms, and lose 8%
if the economy moves into a recessionary period. Economists predict a 65% chance of a normal
economy, a 25% chance of a boom, and a 10% chance of a recession. What is the expected return on the
stock? - Answers 11.10%
The wider the dispersion of returns on a stock, the: - Answers higher the standard deviation.
The actual real rate of return on an investment will be positive as long as the: - Answers nominal return
exceeds the inflation rate.
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller TutorJosh. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $8.09. You're not tied to anything after your purchase.
