Find effective annual interest rate

Reference no: EM1346313

The return distribution for the asset XYZ is as shown below:
Return Probability
- 0.1 0.10
+ 0.1 0.40
+0.20 0.30
+0.30 0.20

What is the standard deviation for the XYZ returns?
A. 0.0125
B. 0.1118
C. 0.0625
D. 0.0791

The beta of Microsoft's stock is 1.2, whereas the risk-free rate of return is 4 percent. Assume that the expected return on the market is 16 percent. Then, what is the expected return on Microsoft stock?
A. 8.80%
B. 28.00%
C. 18.40%
D. 23.20%

If you have a 3 year loan that requires $1,000 payments each year at 7% annual interest rate what would be the present value of the loan?
A. $2,624.32
B. $3,000.00
C. $3,210.00
D. $2,803.74

Robert has a mortgage on his home of $400,000 and has a fixed rate mortgage of 6.125% for 30 years. What would his monthly payments be for this loan?
A. $2,041.67
B. $2,596.55
C. $2,430.45
D. $2,788.46

What is the effective annual interest rate?
A. The simplest interest rate charged.
B. Rate that reflects compounding.
C. Rate with bank fees included.
D. Interest rate quoted by banks.

Reference no: EM1346313

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