Which stock has a higher systematic or market risk

Assignment Help Finance Basics
Reference no: EM133004535

Suppose that in the coming year, you expect Exxon-Mobil stick to have a volatility of 42% and a beta of 0.9, and Merck's stock to have a volatility of 24% and a beta of 1.1. The risk free interest rate is 4% and the market's expected return is 12%. Which stock has a higher systematic or market risk?

Reference no: EM133004535

Questions Cloud

Draw a ladder logic diagram to represent : Draw a ladder logic diagram to represent the operation of this motor - Find out what is wrong in the following ladder logic diagram
Calculate the forward price and value of forward contract : Calculate the forward price and the value of the forward contract in three months, assuming that the price of the stock drops to $58
How would divide up investment : Consider you have $5000 to invest in stocks. How would you divide up your investment? Which stocks would you purchase and how much for each?
Examining stochastic processes : Assume 3 risky assets X, Y, Z where the expected returnexpected return of X is 7%, the of Y is 4% and historical/ deterministic/ observed returns of Z is 0.02%.
Which stock has a higher systematic or market risk : Suppose that in the coming year, you expect Exxon-Mobil stick to have a volatility of 42% and a beta of 0.9, and Merck's stock to have a volatility of 24% and a
Explain the meaning of the terms convenience yield : Explain the meaning of the terms "convenience yield" and "cost of carry". Then, critically discuss the relationship between futures price, spot price
Would have kept locateplus as client : If you were the new auditor for locatePlus Holdings, what question would you have asked the predecessor auditor? and would you have kept Locateplus
How much is the partnership profit before salary and bonus : A and B's partnership agreement, If B's share in the partnership profit for the year is P32,000, how much is the partnership profit before salary and bonus?
Calculate eps for fetzer corporation : One million shares of common stock outstanding at the beginning of the year and issued an additional one million shares on March 31, 2016. Calculate EPS.

Reviews

Write a Review

Finance Basics Questions & Answers

  Advertise a future value like this without a disclaimer

Is this deceptive advertising? Is it unethical to advertise a future value like this without a disclaimer?

  Attraction of foreign investments to australian investors

Explain how low Australian interest rates can affect the tendency of Australia-based MNCs to invest abroad and In general terms, what is the attraction

  What is the current market capitalization of abc

ABC Corporation is acquiring DEF Corp for 240.6 million in an all stock deal. After the merger, the shareholders of ABC will hold 70% of the combined company, w

  Rationale for the contemporary management

Rationale for the contemporary management technique selected. In-depth analysis of the technique, in which you fully describe the technique, its implementation process, its application by other organizations, its applicability to your organization/..

  Corporations often use different costs of capital for

corporations often use different costs of capital for different operating divisions. using an example calculate the

  Determine the amount of dividends per share for common

Determine the amount of dividends per share for common and prefrred stock for all 3 years. The preferred shares are cumulative preferred.

  How much does franklin pay for the loan

Schroeder borrows 8500 dollars from Peppermint Patty at an effective rate of 4.9 percent, and agrees to make 9 equal annual payments

  Calculate the npv of the decision to switch

Sanchez, Inc., is considering a change in its cash-only sales policy. The new terms of sale would be net one month. The required return is .8 percent per month.

  How much money will you have in savings

If you invest $21,264 today at an interest rate of 5.05 percent, compounded daily, how much money will you have in your savings account in 14 years?

  What is the firm current book value per share

What is the firm's current book value per share? $ 6.25. What is the firm's current P/E ratio? What is the current required return for Encore stock? What will be the new required return for Encore stock assuming that they expand into European and Lat..

  Calculate the amount she will need to deposit today

Calculate the amount she will need to deposit today to reach her retirement goal. (Enter a positive value and round to 2 decimals)

  Total value of the terminal year non-operating cash flows

What is the total value of the terminal year non-operating cash flows (after-tax salvage value + working capital recovered) at the end of Year 4?

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