Week 7 Chapter 11 & 12 Homework
P2.
In late 2010, you purchased the common
stock of a company that has reported significant earnings increases in nearly
every quarter since your purchase. The price of the stock increased from $12 a share at the time of the
purchase to a current level of $45. Notwithstanding
the success of the company, competitors are gaining much strength. Further,
your analysis indicates that the stock may be over-priced based on your
projection of future earnings growth. Your analysis, however, was the same one
year ago and the earnings have continued to increase. Actions you might take
range from an outright sale of the stock (and the payment of capital gains tax)
to doing nothing and continuing to hold shares. You reflect on these choices as
well as other actions that could be taken. Describe the various actions that
you might take and their implications.Chapter 12
P6 -Find the real return on the
following investments:

Stock

Don't use plagiarized sources. Get Your Custom Essay on
Strayer FIN100 week 7 homework
Just from $13/Page
Order Essay

Nominal
Return

Inflation

A

10%

3%

B

15%

8%

C

-5%

2%

P8: The countries of Stabilato and
Variato have the following average returns and standard deviations for their
stocks, bond, and short-term government securities. What range of returns
should you expect to earn 95 percent of the time for each asset class if you
invested in Stabilatos securities? From investing in Variatos securities?

Stabilato
Asset

Average
Return

Standard
Deviation

Stocks

8%

3%

Bonds

5%

2%

Short-Term
Govt Debt

3%

1%

Variato
Asset

Average
Return

Standard
Deviation

Stocks

15%

13%

Bonds

10%

8%

Short-Term
Govt Debt

6%

3%

  

Leave a Reply

Your email address will not be published. Required fields are marked *

Menu
Open chat
Hello 👋
Can we help you?