Which investment is riskier

Assignment Help Finance Basics

Reference no: EM13279586

Stock A has an expected rate of return of 8 percent, a standard deviation of 20 percent, and a market beta of 0.5. Stock B has an expected rate of return of 12 percent, a standard deviation of 15 percent, and market beta of 1.5. Which investment is riskier? Why? (Hint: Remember that the risk of an investment depends on its content.)

Reference no: EM13279586

Questions Cloud

Describe how a capacitor filter up the noise : How a capacitor filter up the noise, explain using logic thinking perspective method. Not using the formula to explain. (Explanation should suitable for newbie to understand)

Calculate the book value of existing press being replaced : The old press was purchased 2 years ago for an installed cost of $35,000 and can be sold for $20,000 net of any removal costs today. Both presses are depreciated under the MACRS 5-year recovery schedule. The firm is in 40 percent marginal tax rate..

Evaluate the number of grams of mg required : Calculate the number of grams of Mg required if you need a molar equivalency of 1.25. Then calculate the amount of benzaldehyde (106.12 g/mol), benzophenone (182.22 g/mol), and methyl benzoate (136.15 g/mol) needed (they each get a whole 3.2 g bro..

What is the incremental cash flow related to working capital : Enter negative sign in front of the number or put parentheses around the number. The answer to this question is negative not positive.

Which investment is riskier : Stock B has an expected rate of return of 12 percent, a standard deviation of 15 percent, and market beta of 1.5. Which investment is riskier? Why? (Hint: Remember that the risk of an investment depends on its content.)

Determine the attenuation constant and the phase constant : A two-wire air line has the following line parameters: R = 0.404 (m/m), L= 2.0(µH/m),G= 0, and C= 5.56 (pF/m). For operation at 5 kHz, determine (a) the attenuation constant a,(b)the phase constant ß, (c) the phase velocity u,

Estimate the weighted average cost of capital : Estimate the weighted average cost of capital (WACC) assumingthe cost of debt is 14% (rd = 14%) and a tax rate of 40 percent.

Define what is the empirical formula for this compound : A compound is composed of elements C, H, and N. A 11.550-mg sample of the unknown compound was combusted, producing 31.332 mg of CO2 and 8.983 mg of H2O. What is the empirical formula for this compound

What is the heat capacity of this object : If 1800J of heat are added to a 190-g object, its temperature increases by 10o C. What is the heat capacity of this object

User Account

All Pages