User Account

All Pages

Undervalued-overvalued stock

Assignment Help Basic Statistics
Reference no: EM132107881

Undervalued /overvalued stock

A manager believes his firm will earn a 7.9% return next year. His firm has a beta of 1.69, they expect a return on the market is 15.9%, and the risk-free rate is 5.9%. Compute the return the firm should earn given its level of risk and determine whether the manager is saying the firm is under value or overvalued.

I got 22.8% and I chose overvalued and is that correct and why?

Reference no: EM132107881

Questions Cloud

Increase in the percentage of a company : What could be the reasons for an increase in the percentage of a company's total asset turnover aside from (a) increase in sales, and (b) decrease in asset?
What is the annual cash flow amount for years : It then pays $25 at the end of each year for years 21-30. Interest rates are 7 percent. What is the annual cash flow amount for years 11-20?
Explain repeated ethical scandals through the lens : PUB20002 - Public Relations Theory and Practice - Explain repeated ethical scandals through the lens of Public Relations Theory and Practice theories
Decline in interest coverage ratio of a firm : What could be the reason for a decline in interest coverage ratio of a firm?
Undervalued-overvalued stock : A manager believes his firm will earn a 7.9% return next year. His firm has a beta of 1.69, they expect a return on the market is 15.9%, and the risk-free rate
What is the terminal value on an initial investment : What is the terminal value on an initial investment of 250 if the investor is seeking a 17% yield to maturity after 3 years?
What price should you be willing to pay for the stock : If the required return is 8%, what price should you be willing to pay for the stock?
Implement the honeypot in a virtual environment : CSI6116 Network Security - Edith Cowan University - Implement the honeypot in a virtual environment (you may use vmware, virtualbox, docker
What is the yield to maturity : What interest rate on an investment would turn 120 into 172.8 over two years? What is the yield to maturity? What is the proportional rate over three months?

Reviews

Write a Review

Basic Statistics Questions & Answers

  Describe steps of hypothesis testing for the situation

Assuming that this class is representative of all college students, is there evidence that the proportion of college students whose feet are the same length.

  Indicate whether each statement refers to a uniformly

indicate whether each statement refers to a uniformly distributed variable normally distributed variable andor an

  Maximum number of wheel bearings

Wheel-Rite has agreed to ship the maximum number of wheel bearings that it produces each day to Itex when an order has been received.

  Calculate the standard error of the sample proportion

U.S. News and World Report (December 19, 1994) reported on a survey of 1000 American adults, conducted by telephone December 2-4, 1994.

  What is probability that all four have alzheimers disease

What is the probability that all four have Alzheimer's disease?- What is the probability that exactly one has Alzheimer's disease?

  Suppose that in bags of christmas mampms half of the

suppose that in bags of christmas mampms half of the mampms are supposed to be red and the other half green. in a bag

  What happen to chance variation for good defense

The corporation there's a pretty good chance the average number of days absent would be 12 or more. that's what happened to us chance variation. Is this a good defense? Justify your answer.

  Estimate the difference in the mean bmi between boys-girls

An investigator wants to design a study to estimate the difference in the mean BMI between boys and girls age 12 living in new york city. How many boys and girls are needed to ensure 95% confidence interval estimate for the difference in mean BMI ..

  Standard deviation for this suv model

What is the city mileage standard deviation for this SUV model?

  Points are chosen at random inside a circle

What is the probability that the fourth point will fall inside this triangle? What are the probabilities when the points are chosen at random inside a circle?

  High density lipoprotein hdl in healthy males follows a

high density lipoprotein hdl in healthy males follows a normal distribution with a mean of 50 and a standard deviation

  Effect of maternal welfare receipt on the probability

It is sometimes asserted that the welfare system creates a form of intergenerational "dependency." That is, children born into households that receive welfare.

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!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

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