2)(25%) + (0.1)(60%) = 11.40%. (2 = (-50% - 11.40%)2(0.1) + (-5% - 11.40%)2(0.2) + (16% - 11.40%)2(0.4) + (25% - 11.40%)2(0.2) + (60% - 11.40%)2(0.1) (2 = 712.44; ( = 26.69%. CV = [pic] = 2.34. 6-2 Investment Beta $35‚000 0.8 40‚000 1.4 Total $75‚000 bp = ($35‚000/$75‚000)(0.8) + ($40‚000/$75‚000)(1.4) = 1.12. 6-3 kRF = 5%; RPM = 6%; kM = ? kM = 5% + (6%)1 = 11%.
Premium Investment Rate of return Interest
amount Rs.40‚000 every year for 30 years‚ till he reaches the age of 60. At age 60 You‚ the Early Starter would have invested just Rs. 200‚000 and seen your investment grow to ~Rs. 3.4 million‚ and seen a return of 16x. Someone like me who woke up later‚ will have invested a not inconsiderable Rs. 1.2 miliion‚ but seen only a 3x return! Wished I could start the game all over again? You bet‚ I did! Understood perfectly this aspect of time value of money or what is also called the power of compounding
Premium Investment Mutual fund
Managers are in business to make money. Product or service. SUPPLIERS - Source – Make – Deliver - CUSTOMERS They also Plan – above Make. Also‚ service product/service after they deliver product/service. Today more than ever‚ managers/SC must manage returns. Managing the return function is extremely important now. SCOR model – supply chain operations reference model. How businesses do business. Projects and processes. Improve processes of projects. Can you have a perfect process? Should
Premium New product development Customer service Customer relationship management
forces and factors that affect ALL the firms and cannot be eliminated through portfolio diversification. In this case‚ the nondiversifiable risk is about 6.00%. Notice that the area between the red curve and the green line (which represents the diversifiable risk) diminishes as it approaches the green line. P8-18 Graphical Derivation of Beta c) Looking at the graph we can see that the best-fit line of returns for Asset B is steeper (has greater slope) than Asset A The slopes of these lines
Premium
LTA 1/04 • P. 9– 2 4 EVA LILJEBLOM AND MIKA VAIHEKOSKI* Investment Evaluation Methods and Required Rate of Return in Finnish Publicly Listed Companies ABSTRACT Financial literature advocates the use of the Net Present Value method for the evaluation of investments. Its key parameter is the required rate of return on equity‚ which is to be calculated using the Capital Asset Pricing Model or a similar model especially if the company is publicly listed. However‚ there is ample evidence
Premium Net present value Investment Capital budgeting
Investment Behavior‚ Observable Expectations‚ and Internal Funds Jason G. Cummins ∗ Assistant Professor New York University 269 Mercer Street New York‚ NY 10003 jcummins@econ.nyu.edu Kevin A. Hassett Resident Scholar American Enterprise Institute 1150 17th Street NW Washington‚ DC 20036 khassett@aei.org Stephen D. Oliner Asst. Dir. of Research Federal Reserve Board Mail Stop 93 Washington‚ DC 20551 soliner@frb.gov First Draft: September 8‚ 1997 Second Draft: July 6‚ 1998 Third Draft: March 31
Premium Investment Finance Arithmetic mean
Objectives of Firms Introduction to Business Objectives Standard theory assumes that businesses have sufficient information‚ market power and (importantly) motivation to set prices for their products that maximise profits This assumption is now heavily criticised by economists who have studied the organisation and objectives of modern-day corporations. Not only do most businesses frequently move away from pure profit-seeking behaviour‚ many are organised and operated in a way where profit is not the
Premium Business Business school Management
Returns 1 RETURNS Prices and returns Let Pt be the price of an asset at time t. Assuming no dividends the net return is Pt Pt − Pt−1 −1= Rt = Pt−1 Pt−1 The simple gross return is Pt = 1 + Rt Pt−1 Returns 2 Example: If Pt−1 = 2 and Pt = 2.1 then 2.1 Pt 1 + Rt = = = 1.05 and Rt = 0.05 Pt−1 2 Returns 3 The gross return over k periods (t − k to t) is 1 + Rt (k) := Pt−1 Pt−k+1 Pt Pt ··· = Pt−k Pt−1 Pt−2 Pt−k = (1 + Rt ) · · · (1 + Rt−k+1 ) Returns are • scale-free‚ meaning that they do not depend
Premium Normal distribution Standard deviation
Plan B More Than Just A Pregnancy Alternative If there was a form of birth control available that could greatly reduce the number of abortions and unwanted pregnancies in America‚ wouldn ’t you be all for it? As a woman who believes in the right to choose but also values life‚ I believe this could be the answer to many controversial issues in the United States today. Controversy and bureaucracy surround a drug that exists today that could accomplish this goal. The pill‚ Plan
Premium Birth control Abortion
The people who live in countries such as the Phillipines and India have been enjoying the Benefits of Moringa for centuries. This plant is a significant source of both minerals and vitamins. It has been used typically as a vegetable in soups in order to obtain all of its goodness. The people of the Phillipines and India have long used it for overall wellness as well as to manage their pain and to encourage weight loss. Zija offers a variety of ways that you can obtain the Benefits of Moringa
Premium