CA Corporate has an available funds of $200,000 is considering for new investmentopportunities. The investment portfolio of a variety of stocks has relevant financial data asfollows:StocksABсDPrice per share ($)100508040Annual rate of return0.120.080.060.100.100.07 0.05 0.08Risk measure per dollar invested(Higher values indicate greater risk)The risk measure provided by the firm's top financial advisor, indicates the relativeuncertainty associated with the stock regarding the realization of its projected annual rate ofreturn. Top management of CA Corporate has stipulated the following investment guidelines:1. The annual rate of return for the portfolio must be at least 9%.2. No one stock can count for more than 50% of the total dollar investment.For this overall situation, develop a linear programming model to yield an investmentportfolio which minimizes total risk. What is the total risk and the total return, if the amountto be invested in stocks A, C and D are $333.50, $833.60 and $2500, respectively.

Investment portfolio of stocks is given as follows:

Answered: CA Corporate has an available funds of…

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter10: Introduction To Simulation Modeling

Section: Chapter Questions

Problem 46P

See similar textbooks

Similar questions

Suppose that machinery used by a bank for sorting and clearing cheques breaks down. This is a manifestation of: Select one: a. Liquidity Risk b. Operational Risk c. Credit Risk d. Insolvency Risk
Annual returns on small stocks have a population mean of 12% and a population standard deviation of 20%. If the returns are normally distributed, a 90% confidence interval on mean returns over a 5-year period is: 5.40% to 18.60%. –2.75% to 26.75%. –5.52% to 29.52%.
Assume a company's Income Statement for Year 12 is as follows: Year 12 (in 000s) Income Statement Data Net Revenues from Footwear Sales $ 580,000 370,000 40,000 75,000 15,000 90,000 Cost of Pairs Sold Warehouse Expenses Marketing Expenses Administrative Expenses Operating Profit (Loss) Interest Income (Expense) Pre-tax Profit (Loss) Income Taxes Net Profit (Loss) (15,000) 75,000 22,500 $ 52,500 Based on the above income statement data and assuming the company has 20 million shares of common stock outstanding , the company's operating profit margin and EPS were Copyright O by Glo-Bus Software, Inc. Capying, distributing, ar 3rd party website posting isexpressly prohibited and constitutes copyright vialation. 15.52% and $4.50. O 9.05% and $3.75. 13.79% and $1.75. O 12.93% and $3.75. O 15.52% and $2.63.
Which of the following losses or outgoings incurred cannot be deducted as a general deduction by a share investor: Group of answer choices Interest on money borrowed to buy shares expected to produce dividends, Investment journals and publications. Investment journals and publications. Subscriptions to share market information services. Management fees or retainers to investment advisers for an initial investment plan. Management fees or retainers to investment advisers for ongoing investment advice.
The time series line chart below shows the total return on a stock index fund over a certain time period. Describe the overall trend in the total return for this time period. T. Rowe Price Equity Income Total Return 4.10% Am 25 0% 0.00% 2017 2018 2019 2020 2021 Kiplinger Feb 24 2021, 11 49AM EST Powered by /CHARTS
Management ========= 2. What are the factors that affect financial management objectives?
On-Balance Sheet Items (Assets) (in millions) Cash $ 10,000 Government securities 30,000 Interbank deposits 5,000 Home loans to personal finance customers 20,000 Loans to corporate customers 75,000 Total Balance Sheet Assets $140,000 Off-Balance Sheet Items Standby letters of credit backing corporate borrowings $ 10,000 Long term unused loan commitments made to private corporations 20,000 Total Off-Balance Sheet Items $30,000 Bank Capital Common stock (par value) $ 1,000 Surplus 1,500 Retained earnings 1,500 Subordinated debentures 2,000 Minority interest in subsidiaries 1,000 Allowance for loan and lease losses (reserves) 1,000 Non cumulative perpetual preferred stock 1,000 Intermediate term preferred stock 4,000 Equity commitment notes 2,000 Basel…
Using time value of money tables, calculate the following. (Exhibit 1-A, Exhibit 1-B, Exhibit 1-C, Exhibit 1-D) Note: Use appropriate factor(s) from the tables provided. The future value of $490 six years from now at 5 percent. The future value of $600 saved each year for 10 years at 7 percent. The amount a person would have to deposit today (present value) at an interest rate of 7 percent to have $900 five years from now. The amount a person would have to deposit today to be able to take out $600 a year for 10 years from an account earning 9 percent.
Evaluate the following statements:S1. Any investment income of general borrowing is deducted from capitalizable borrowing cost.S2. If the asset is financed by specific borrowing but a portion is used for working capital purposes, the borrowing shall be treated as general borrowing in determining capitalizable borrowing cost. a.False, False b.False, True c.True, True d.True, False
- Consider demand: x(p₁) = 400 — 2p1 At a market price of p₁ = $125 per unit: • Determine the social loss due to moral hazard when assuming: 1. Full insurance compared to uninsured 2. A co-payment of $50 compared to uninsured 3. A 75% coinsurance rate compared to uninsured
In business, general partners will have full involvement in the business. Their liabilities are: Average Limited Unlimited Low
Which of the following are important to investors evaluating direct participation programs? I. The economic soundness of the program II. The expertise of the general partner III. The basic objectives of the program IV. The start-up costs A I, II, and IV B I, II, and III C I, II, III, and IV D II, III, and IV

SEE MORE QUESTIONS

Recommended textbooks for you

Practical Management Science

Operations Management

ISBN:

9781337406659

Author:

WINSTON, Wayne L.

Publisher:

Cengage,

Practical Management Science

Operations Management

ISBN:

9781337406659

Author:

WINSTON, Wayne L.

Publisher:

Cengage,

SEE MORE TEXTBOOKS