Based on the following information, what is the standard deviation of returns? State of Economy Recession Normal Boom Probability of State of Economy .32 .35 .33 Rate of Return if State Occurs -.102 .117 .227
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- Match each term with the best definition or descriptor. NPV is __________ ( a unitless ratio, a unit of time, a dollar vallue, or a rate of return). IRR is ___________ ( a unitless ratio, a unit of time, a dollar vallue, or a rate of return). Profitability index is __________( a unitless ratio, a unit of time, a dollar vallue, or a rate of return).Which of the following correctly orders the investment rules of average accounting return (AR), internal rate of return (IRR), and net present value (NPV) from the most desirable to the least desirable? a. IRR, AR, NPV. b. AR, IRR, NPV. c. NPV, AR, IRR. d. AR, NPV, IRR. e. NPV, IRR, AR.Define each of the following terms: c. Net present value (NPV) method; internal rate of return (IRR) method;profitability index (PI)
- Which one of the following is most closely related to the net present value profile? A: Payback B: Discounted payback C: Profitability index D: Average accounting return E: Internal rate of returnWhat is the formula to find an expected in returns in CAPMFrom the table given, how can I compute 1. the covariance of returns and 2. the correlation between Company A and B? Thanks!
- Which of the following is NOT a profitability ratio? Select one:a. Return on Equityb. Net Profit Marginc. Return on Assetsd. Average Collection PeriodH Consider the three stocks in the following table. Pe represents price at time t, and Qe represents shares outstanding at time t Stock C splits two-for-one in the last period. Pe 81 41 82 lo 100 200 200 Rate of return P₁ 86 36 92 li 100 200 200 % P₂ 86 36 46 Required: Calculate the first-period rates of return on the following indexes of the three stocks: (Do not round intermediate calculations. Round your answers to 2 decimal places.) a. A market value-weighted index 2₂ 100 200 400How do you turn an income statement int a forecasted return? And how is it helpful?
- Expected return (Kj)Expected return and standard deviation. Use the following information to answer the questions. State of Economy Probability of State Return on Asset D in State Return on Asset E in State Return on Asset F in State Boom 0.34 0.08 0.29 0.19 Normal 0.55 0.08 0.17 0.11 Recession 0.11 0.08 −0.24 −0.09 a. What is the expected return of each asset? b. What is the variance of each asset? c. What is the standard deviation of each asset? Hint: Make sure to round all intermediate calculations to at least seven (7) decimal places. The input instructions, phrases in parenthesis after each answer box, only apply for the answers you will type. a. What is the expected return of asset D? (Round to four decimal places.) What is the expected return of asset E? (Round to four decimal places.) What is the expected return of asset F?…Choices for the last requirement, "determine the approximate internal rate of return from the choicies (pick the closest answer. a. 29% b. 20% c. 26% d. 22%
