00 Return 5% 5% 10% 3% Expected return Weighted Value 1.75% 0.25% 2.0% 1.2% 4.70% E8-3. Comparing the risk of two investments Answer: CV1 0.10 0.15 0.6667 CV2 0.05 0.12 0.4167 Based solely on standard deviations‚ Investment 2 has lower risk than Investment 1. Based on coefficients of variation‚ Investment 2 is still less risky than Investment 1. Since the two investments have different expected returns‚ using the coefficient of variation to assess risk is better than simply comparing standard
Premium Rate of return Investment Variance
Interest Rates and Other Critical Determinants of Investment Spending in Bangladesh Background Investment‚ which is a spending devoted to enhancing or maintaining the existing stock of capital in the economy provides goods and services necessary for better standard of living. Moreover‚ it has greater importance as a policy tool. Policymakers often try to achieve target growth in GDP by influencing the level of investment. They do so by undertaking policies that influence the rate of interests
Premium Regression analysis Investment Pearson product-moment correlation coefficient
Answers to Text Discussion Questions 7-1. Cash and marketable securities are generally used to meet the transaction needs of the firm and for contingency purposes. Because the funds must be available when needed‚ the primary concern should be with safety and liquidity rather than the maximum profits. 7-2. Liquidity is the quality of converting an asset to cash quickly and at fair market value. 7-3. The treasury manager is most concerned with daily cash flows of a corporation as it is the
Premium Interest Accounts receivable Generally Accepted Accounting Principles
producing the largest NPV. By contracting manufacturing‚ Nucleon will be able to focus on core competencies with no capital investments. Also‚ by vertical integration Nucleon gains sources of competitive advantage. Contracting manufacturing focuses on core competencies. Nucleon will have facilities and personnel in place to implement phases I and II‚ require no capital investments (reducing up front costs: Table 1)‚ and therefore able to focus on clinical trials. As Hurt’s commented‚ “It’s important
Premium Investment Finance Net present value
in 10 years time? A. $40‚000 B. $47‚000 C. $45‚000 4. Negative gearing is: A. Where the interest payments are approximately the same level as income earned from an investment. B. Where income earned from the investment is significantly less than interest paid on the borrowing. C. Where the amount borrowed to fund an investment is higher than the equity capital. D. The least risky gearing to use. 5. The percentage of share ownership in Australia by the adult population since 1992 has: A. increased
Premium Investment Tax Pension
growth in its GDP consecutively for almost two decades. The economic situation prevailing globally requires the investors today to assess the opportunities across the globe and China looks to have favourable macroeconomic factors towards being a good investment opportunity. Background of China’s Phenomenal Growth Though China was proclaimed communist right after the 1949 revolution‚ it wasn’t until Deng Xiaoping came into power in 1976 that central planning was infused with capitalist thoughts and
Premium Macroeconomics Investment Foreign direct investment
Investment Policy‚ Ethics‚ and Portfolio Management March 10‚ 2010 Mid-Term Problems Chapter 13 Question 1) Briefly describe the results of studies that examined the performance of alternative industries during specific time periods and discuss their implications for industry analysis. Industry analysis is performed and relevant because different industries have different performance over time periods and during different stages of the business cycle. Yearly performance studies
Premium Product management Capitalism Business cycle
Financial security remains a key concern for people at any age. People need money so that they can retire comfortably‚ and making the right investment decision ensures that their investment generates income for retirement. In most jobs‚ people have limited options to invest. Therefore‚ people save for retirement in various pension plans which are offered by the employer. However‚ making the right choice where and how to invest is a challenge‚ which shows that most people are not financial experts
Premium Investment Employment Retirement
The Foreign Direct Investment in South Korea South Korea‚ one of four Asian tigers is a center of economic activity‚ culture‚ and art. Today‚ most of the multinational companies prefer to invest in this Asian nation not only because it is a democratic nation‚ but also it is favorable to FDI‚ and with fewer barriers. Therefore‚ in this assignment I am going to discover how South Korea is favorable to FDI by analyzing several factors‚ including its economic system‚ projected size of the national market
Premium South Korea Investment Foreign direct investment
Why You Shouldn’t ‘Invest’ in Life Insurance The three reasons people buy insurance is: a) To save tax. b) As an investment‚ to make a good return on their money. c) To feel good that one has some insurance or to get rid of that pesky uncle who keeps mentioning it. The fourth — and perhaps most important — reason to buy insurance is to let your family be financially secure if you die. This is the only reason anything should be insured. Car insurance gives you money if your car has an accident
Premium Investment Mutual fund