Economy probability of state of economy rate of return

Assignment Help Financial Management
Reference no: EM131558431

Consider the following information: State of Economy Probability of State of Economy Rate of Return if State Occurs Recession .20 – .09 Normal .45 .11 Boom .35 .30 Calculate the expected return. (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Expected return %

can you guys exlpain the answer and put it in decimal form

Reference no: EM131558431

Questions Cloud

Unsystematic risk can be defined : Unsystematic risk can be defined by all of the following except:
Capital asset pricing model and why beta is measure of risk : Explain what is meant by the market risk premium in the capital asset pricing model and why Beta is a measure of risk.
Calculate cost of new common equity financing of stock : Calculate the cost of new common equity financing of stock Q using Gordon Model. Cost of Common Equity ?
What is the risk premium on this stock : July Markets has a beta of -0.29. The risk-free rate of return is 0.0227 and the market rate of return is 0.0584. What is the risk premium on this stock?
Economy probability of state of economy rate of return : State of Economy Probability of State of Economy Rate of Return. Calculate the expected return.
Explain the shadow banking system : Explain the “shadow banking system,” and why the FederalReserve and other regulatory agencies rescued an “unregulated” insurancecompany and investment bank.
What are the expected inflation rates : What are the expected inflation rates in US and UK? What is the expected % change in pound's value over the next year?
Can you make profit via tiriangular arbitrage : Can you make a profit via tiriangular arbitrage? If you have an initial 12,000 Swiss Francs, calculate the amount of profits in Swiss Francs.
Black bird company plans an expansion : The Black Bird Company plans an expansion. If the company is in the 34 percent tax bracket, what is the weighted average cost of capital?

Reviews

Write a Review

Financial Management Questions & Answers

  What is the degree of operating leverage of modern artifacts

Modern Artifacts can produce keepsakes that will be sold for $120 each. Nondepreciation fixed costs are $1,600 per year, and variable costs are $100 per unit. The initial investment of $4,800 will be depreciated straight-line over its useful life of ..

  The nominal return on your investment

You want to have $2 million in real dollars in an account when you retire in 40 years. The nominal return on your investment is 10 percent and the inflation rate is 3.8 percent. What real amount must you deposit each year to achieve your goal?

  Compute the price of a european put option

Compute the price of a European put option on the 2-year bond with face value $100,

  Ny switchover cost necessary to make acd financial edi-ready

ACD, Inc., a computer parts company, presently pays its largest supplier by check and is trying to determine whether to switch to electronic payment. Its present credit period is 45 days. Its opportunity cost for funds is 8% annually. Its supplier ha..

  Does your equal payment period match compounding period

Does your equal payment period match the compounding period?

  What is the current fair value of the stock to investors

The Storico Company's most recent annual dividend is $2.50 per share. It is expected that Storico's dividend will grow at 13% per year for the next three years and then settle down to 8% per year, indefinitely. What is the current fair value of the s..

  Calculate the wacc using market value weights

Common equity is 16% and its before tax cost is 13% and its marginal tax rate is 40%. Assume that the firm's long term debit sells at par value. The firm has 576 shares of common stock outstanding that sells for $4.00 per share. Calculate the WACC us..

  Does your current or previous workplace have a formal

Does your current or previous workplace have a formal, established road map for the organization's future? Does your employer have a vision of where it wants to go? If not, why not—what are the barriers to developing a vision? If not, how could it be..

  Interpret the coefficient on after tax wages

Interpret the coefficient on after-tax wages. What does this coefficient imply about the effect of increasing wages from $6 to $10 per hour on labor supply?

  About the odd dividend policy

Hot Wings, Inc., has an odd dividend policy. The company has just paid a dividend of $10.00 per share and has announced that it will increase the dividend by $8.00 per share for each of the next four years, and then never pay another dividend.

  What is the yield to maturity for these bonds

Phillips Fine Fixtures Inc. wishes to issue new bonds but is uncertain how the market would set the yield to maturity. The bonds would be 20-year, 7% annual coupon bonds with a $1,000 par value. Fisher has determined that these bonds would sell for $..

  Though the real estate market has been depressed in some

though the real estate market has been depressed in some countries due to the aftermath of the global financial crisis

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd