Define Treynor’s reward-to-volatility ratio

Q: Define yield curve

A: Yield is the percentage of securities at which the return is provided by the company to its…

Q: are the major assumptions made by economic order quantity (EOQ) model?

A: Step 1 Economic order quantity (EOQ) is the ideal order quantity a company should purchase to…

Q: What is market value ratio?

A: Ratio is the relation between two different quantities obtained after dividing one by another.

Q: Which are the Methods for Finding Rate of Return?

A: A Rate of Return (ROR) is the gain or loss of an investment over a certain period of time. When the…

Q: What does the volatility value represents?

A: Volatility for a given product or market index is a factual proportion of the scattering of profits.…

Q: _______ is a measure of risk while _______ is a measure of risk and liquidity.

A: Capital budgeting is the process of distributing the resources(finance) of the organization in…

Q: Define the term internal rate of return?

A: The internal rate of return (IRR) is a capital budgeting metric used to gauge the benefit of…

Q: which of the following quantifies how closely a manager's return pattern follows that of a benchmark…

A: Managers' performance is evaluated on the basis of pattern that follows with benchmark index.

Q: Define return rate

A: The return rate can be calculated on various assets and can be used to compare various investments.…

Q: Explain price/cash flow ratio

A: Answer: Price to cash flow is determined through the division of price per share by cash flow per…

Q: Present and Explain the theories of the Yield Curve?

A: The yield curve is a curve that shows the relationship between the interest rates and the different…

Q: Define the following terms: Factor risk premium Unit root Random walk with drift…

A: Hello. Since your question has multiple sub-parts, we will solve first three sub-parts for you. If…

Q: Breifly explain what "playing the yield curve" means.

A: The yield on a bond refers to the annual return that one gets as a bond matures. A yield curve is a…

Q: What is the significance of finding the internal rate of return?

A: IRR helps to check the viability of the project. If IRR is more than Kc than Project seems to be…

Q: Define volatility value.

A: Volatility is a rate at which the cost of a security increments or diminishes for a specified set of…

Q: What is Market Value Added (MVA)?

A: The market value added is the difference of the current value of the company and the equity capital…

Q: Whatis a yield curve?

A: It is the percentage of the securities at which the return is provided by the company to its…

Q: Describe in detail the Stochastic Discount Factor (SDF)and its components.

A: Stochastic discount factor is defined as the concept, which has the combination of the financial…

Q: What is normal yield curve?

A: The yield curve is a curve that shows the many yields to maturity and interest rates. The curve also…

Q: Define average return

A: The formula to compute average return as follows:

Q: What is the gradient-series present-worth factor with formula?

A: Step 1: When there is a uniformly change in rate of interest is a gradient series of cash flow. It…

Q: Describe the measure based on an index, known as the benefit-cost ratio?

A: A benefit-cost ratio (BCR) is a proportion used to summarize the general connection between the…

Q: define volatility

A: Volatility is a rate at which the cost of a security increments or diminishes for a specified set of…

Q: What is risk return ratio?

A: Any susceptibility a corporation or organization has to factors that might affect profitability or…

Q: Describe the advantages of the dollar-value LIFO method.

A: Definition:   Dollar value LIFO method: In this method, the valuation of inventory is calculated on…

Q: iven the information below, calculate the reward-to-risk ratio implied by the CAPM pricing model.

A: The risk-reward ratio determines how much reward is there for risk of  every dollar.

Q: What assumptions are made when using the simplest version of the economic-order-quantity (EOQ)…

A:

Q: Explain how cost-of-carry is a factor in forward curve prices.

A: Cost of carry is the costs of holding the certain position in the market or in other words it is the…

Q: Explain CMO Price Behavior and Prepayment Rates?

A: The question is based on the concept of Collateralized Mortgage Obligations (CMO) , interest rate…

Q: Give some examples of the market-value ratios?

A: Market value ratios may include various types of ratios which indicate the value of company’s share.…

Q: Describe relationship between risk and profitability.

A: Risk and profitability have direct relation. Lower the risk, lower is the return and Higher the…

Q: What formula to use to find Payback Period and NPV? (in Excel)

A: NPV or Net Present Value is the present value of all net cash cashflow on a provided discount rate.…

Q: Define real rate of return.

A: Real Rate of Return is defined as the rate that has been adjusted for rise in prices of commodities.…

Q: Describe the Methods for Finding Rate of Return?

A: Capital budgeting is the process a company follows to decide whether to purchase a fixed asset or…

Q: Define yield.

A: Yield can be considered as a metric for cash flow for the investor on the amount with which a…

Q: a. Plot a yield curve based on these data. b. What type of yield curve is shown? c. What information…

A: Note: Since we only answer up to 3 sub-parts, we’ll answer the first 3. Please resubmit the question…

Q: Define yield to call (YTC)

A: A financial instrument with a fixed cost that helps a company to raise funds for business operations…

Q: Critically discuss the application of EWMA, GARCH and asymmetric GARCH models to volatility…

A: Volatility should be forecastable using a volatility model. Almost all financial applications of…

Q: Explain price/EBITDA ratio

A: The EV/EBITDA ratio compares a company's enterprise value to its earnings before interest, taxes,…

Q: Explain payout ratio

A: The net income is the net profit of the company earned during the period. The net income includes…

Q: Explain an upward sloping yield curve using the pure expectation theory.

A: Pure expectation theory: Pure expectation theory states that expected future spot rates will be…

Q: Calculate Paulson's WACC using market-value weights.

A: WACC is the weighted average of the cost of capital employed in a company. A company capital is…

Q: Least-squares regression is a statistical method for identifying cost behavior. True or False True…

A: According to the given question, we are required to give the answer that the statement is true or…

Q: Show that for an initial wealth w and a linear utility function u(w) = w, then P= E[X].

A: Linear utility functions maximize the predicted total benefit and are associated with risk-averse…

Q: What are the four aspects of rate-of-return analysis?

A: Rate of return analysis tells the rate of return which a investment can give. It carefully analyse…

Q: Explain an example how to calculate internal rate of return.

A: IRR is the return actually earned by the investor and discount rate is the return which the investor…