How much should be invested in risk-free asset to achieve

Assignment Help Financial Accounting
Reference no: EM132869356

Question 1: You want to build a portfolio with a beta of 0.98. Right now you have invested $15,000 in Stock A with a beta of 0.60 and $7,500 in Stock B with a beta of 1.6. You have another $7,500 to invest and you want to divide this amount between Stock C with a beta of 1.3 and a risk-free asset. How much should be invested in the risk-free asset to achieve a portfolio beta of 0.98?

Reference no: EM132869356

Questions Cloud

What is the market value of abc debt based on black-scholes : What is the market value of ABC's debt based on the Black-Scholes model? XYZ Inc. has an issue of zero-coupon bond outstanding with a $1,800,000 face value.
Determine the proper amount of net income as of december : An insurance policy covering 12 months was purchased on October 1, 2018, for $20,400. Determine the proper amount of net income as of December
What is the minimum bond value for xyz inc : Bonds have a current market return of 8.0 percent. The current price of the company's stock is $28 per share. What is the minimum bond value?
Determine scope of district four production warehouse : Determine the scope of the District 4 Production Warehouse Move project from the information provided in the case.
How much should be invested in risk-free asset to achieve : You want to build a portfolio with a beta of 0.98. How much should be invested in the risk-free asset to achieve a portfolio beta of 0.98?
What is the wacc for the firm for xyz inc : What is the WACC for the firm? The firm also has 1,850,000 shares of 4.45 percent preferred stock which carry an annual dividend of $4.45
Express your opinions about executive compensation : Express your opinions about Executive Compensation? Express you opinions about Unions and their impact on U.S. global competitiveness?
Calculate the cost of goods completed during april : Calculate the cost of goods completed during April and the cost of the ending work-in-process inventory
What amount will the equity value of the combined company : What amount will the equity value of the combined company change if the merger occurs and the asset return standard deviation of the merged firm is 45 percent?

Reviews

Write a Review

Financial Accounting Questions & Answers

  State any three examples of market manipulation

State four elements that make speculative trading in stocks an outright gambling. State any three examples of market manipulation.

  Compute the predetermined variable overhead rate

Compute the predetermined variable overhead rate and the predetermined fixed over­head rate. Compute the applied overhead for Byrd for the year.

  Discuss the issue of measurement and provide examples

HOLMES INSTITUTE - HA3011 Advanced Financial Accounting Assignment - Discuss the issue of measurement and provide examples

  What nonquantifiable factors vernom corporation consider

What nonquantifiable factors should the Vernom Corporation consider in determining whether they should make or buy the lipstick tubes?

  Beech refuses to state her marital status

Beech refuses to state her marital status on Form W-4 which she gave to you, the payroll manager, when she was hired

  Describe three major theories regarding the way dividend

Describe three major theories regarding the way dividend payouts affect a firm's value. Explain these terms, and briefly describe each theory.

  Amounts equal to the salary and interest allowances

Inter media, LLC, has three members: WYXT Partners, Lindsey Wilson, and Daily Sun Newspaper, LLC. On January 1, 2014, the three members had equity of $355,000, $90,000, and $215,000, respectively. Any remaining income is to be shared in the ratio of ..

  Are cash flow that are directly related to earning income

CFO- Are cash flow that are directly related to earning income. Example, collecting cash from costumers, pay salaries, pay bills, pay to suppliers.

  Fine foods inc a us wholesaler buys merchandise from

fine foods inc a us wholesaler buys merchandise from suppliers in germany and pays the suppliers in euros.nbsp it also

  Assigned anestimated life

The equipment was assigned anestimated life of 10 years and a salvage value of $10,000. On January 1, 2005, ABC Company decided the life of the equipment should be revised from 10 to 15 years with a salvage value of $4,000 at the end of the 15 years..

  Calculate and interpret the inventory days for the firm

Calculate and interpret the inventory days for this firm. Inventory Days = 40.9; it takes an average of 40.9 days for inventory to be sold

  Calculate the present value of the liability

Calculate the present value of the liability and equity components of the convertible notes

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