the cost of equity for rj corporation is 8.4 percent and the debt-equity ratio is .6. the expected return on the market is 10.4 percent and the risk-free rate is 3.8 percent. using the common assumption for the debt beta, what is the asset beta?

Answers

Answer 1

Note that using the above metrics, the Asset Beta would be 0.44.

What is Asset Beta?

The beta of a company's assets is known as asset beta. If the firm is entirely funded by equity, it is equivalent to equity beta. Asset beta, also known as unleveled beta, does not account for the impact of financial leverage.

The Capital asset pricing model (CAPM) illustrates the link between a security's projected return and risk. CAPM states that:

Expected return of a security = Risk-free rate + Beta (Expected return on market - Risk-free rate)

We are given:

Expected return on equity = 8.4Risk-free rate = 3.8Expected return on market = 10.4Beta of equity = B is to be determined

Substituting the given values in the CAPM equation, we get:

8.4 = 3.8 + B(10.4 - 3.8)

8.4 = 3.8 + 6.6B

4.6 = 6.6B

B = 0.7

βAssets = [Debt/(Debt + Equity)] * βDebt + [Equity/(Debt + Equity)] * β Equity

Beta of debt is assumed to be 0, becsuse the interest on debt (cost of debt capital) is not volatile. So the above equation becomes:

βAssets =  [Equity/(Debt + Equity)] * β Equity

Which can also be exppressed as;

βAssets = [βEquity/(1+Debt + Equity)]

Beta of equity is calculated above as 0.7.

Debt / Equity = 0.6, since debt equity ratio is given as 0.6.

Thus,
Beta of assets = 0.7 / (1 + 0.6)

Beta of assets = 0.7 / 1.6

Beta of assets = 0.44

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Related Questions

A basic premise underlying analytical procedures is that
A The study of financial ratios is an acceptable alternative to the investigation of unusual fluctuations.
B Statistical tests of financial information may lead to the discovery of material misstatements in the financial statements.
C Plausible relationships among data may reasonably be expected to exist and continue in the absence of known conditions to the contrary.
D These procedures cannot replace tests of balances and transactions.

Answers

Answer:

C Plausible relationships among data may reasonably be expected to exist and continue in the absence of known conditions to the contrary.

Explanation:

Analytical procedures are defined as a set of practices during financial audit that assists the auditor asses potential risk, gain better understanding of a business, and give a framework for planning of future audits.

It shows relationship between financial and non financial data.

For example variability in relationships between financial and non financial data can result from factors like unusual events, business changes, random fluctuations, and misstatements.

So the basic underlying premise is that relationship among data will continue except conditions influence it to the contrary

Daniel is the vice president of an insurance company that sells workers' compensation insurance. Recently, the company has identified problems of cost control in all of its offices. Daniel formed a team composed of the sales managers of all the four regions, along with some staff members from the company's informational technology and administration departments, to study the problem and make recommendations. This team is an example of a:

Answers

Answer:

Task force

Explanation:

A task force is defined as a group or unit that exists to address a particular issue or set of issues.

They come together to formulate solutions to a problem.

In the given scenario there was problems of cost control in all of the offices.

A team was formed specifically to solve this problem so it is a task force. The make up of the team was sales managers of all the four regions, along with some staff members from the company's informational technology and administration departments.

It is not a command group as the managers do not have the same supervisor or manager.

What do you mean by search of trade?‌Why is it essential?​

Answers

Answer:

trade means buying and selling good and service

Answer:

it takes time,resourses and money to creat and luanch distinctive and affective brands..in most instances,trade searching id an important first step in any trade registration to avoid adopting brans that infrige third-party trademark rights.

Technology plays a role in a variety of industries and the ways that technology impacts marketing are vast and diverse. In a concise one-paragraph summary, narrow down the use of technology in marketing and explain the importance of computers and the internet in marketing.

Answers

Answer:

Marketing is a commercial practice by which companies seek to promote their products, trying to attract consumers through advertisements, promotional campaigns and market research, aimed at meeting the needs of consumers. For this, companies rely on technology (internet, television, radio, etc.) to be able to massify their products, advertising them through the mass media. Within this process, the internet is one of the most important marketing tools, since it allows companies to reach all parts of the world, where potential consumers from any territory can see the advertisements just one click away.

Reasons for unemployment? ​

Answers

Answer:

1.Slow Economic Growth

2.An Increase in Population

3. Slow Growth of Industrialisation

The reasons for unemployment include:

A recession: when there is a recession, the level of output in the economy is low. As a result, there would be less jobs available. low level of wages. When the wages paid to labor is too low, it might discourage people from working. war. When there is a war, economic activities would be disrupted. This would lead to job loss.

What is unemployment?

Unemployment is when people who are willing and able to get are job are without jobs. Types of unemployment include:

Frictional unemploymentVoluntary  unemploymentStructural  unemploymentCyclical  unemployment

When there is a recession, the level of output would be depressed. As a result, unemployment would increase.

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Below is the income tax system for the country of Genovia.


For income from $0 to $100, no income tax.

For all income above $100 but less than $400, the tax rate is 20%.

For all income above $400, the tax rate is 40%.

Jane Doe’s income is $500. What is her AVERAGE tax rate?


Group of answer choices


40%


33%


50%


20%


25%

Answers

Answer:

24%

Explanation:

The computation of the average tax rate is shown below:

Given that

From income $0 to $100, no income tax is applicable

From income above $100  upto $400, the tax rate is 20%

The income above $400, the tax rate is 40%

So based on the above information

Since the Jane doe income is $500

So here the average tax rate is

= (400 × 0.20) + (100 × 0.40) ÷ $500

= ($80  + $40) ÷ ($500)

= ($120) ÷ ($500)

= 24%

This is the answer but the same is not provided in the given options

When you get in a business, make a lot of money, and then get out, it’s referred to as a(n)

A) easy-money business.


B) hit-and-run business.


C) failure.


D) missing opportunity.

Answers

The answer is hit and run business

Answer:

The answer is B. Hit-and-run business.

Explanation:

According to the video, what are some qualities needed by workers involved in sales? Check all that apply.
physical strength
politeness
first-aid skills
good speaking skills

Answers

Answer:

B and D

Explanation:

According to the video, politeness and good speaking skills are qualities needed by workers involved in sales. Thus, options B and D are the correct options.

What Does a Sales Representative Do?

Simply said, a sales representative promotes a company's brand while selling its goods or services. From the first lead outreach until the actual transaction, they maintain client connections and function as the primary point of contact. It is the perfect job if you want to be in control of your career because it is mostly performance-driven, meaning how well you sell directly affects how much money you earn.

All stages of the sales process involve a sales representative having direct consumer interactions. They are in charge of determining a customer's needs, making suitable product or service recommendations, and making sure they have a great experience from beginning to end. Some sales representatives would make cold calls to potential customers they locate in company directories or client referrals. 

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The first step in merchandise management planning is to __________. [This question has been randomly selected from a pool of 5 questions. For optimal success in this class, repeat this chapter's questions until you are sure you are acquainted with all of the alternate versions of each question.] allocate merchandise to stores set inventory and product availability levels forecast category sales configure a model stock plan develop an assortment plan

Answers

Answer:

forecast category sales

Explanation:

Category sales refer to breaking down the companies different product lines into categories, for example, Colgate will break down oral hygiene products and personal care products. each category includes similar products or products that are related to each other. This way you can start working with groups of products that require similar marketing efforts.

Which of the following is the best definition of a liability in accounting?
A. Anything your company owes to someone besides the business
owner
O B. A debt your business owes that must be repaid during the present
accounting period
c. Anything your company owes to the business owner
D. Anything your company needs to sell during the present
accounting period

Answers

The best definition of liability is anything your company owes to someone besides the business owner (option a).

What is liability?

Liabilities are future benefits that would have to be sacrificed in the future by an entity to other entities as a result of past transactions. Liabilities reduce the net worth of a company.

Liabilities are resources that have been borrowed or that are owned. They would need to be repaid at a future date. An example of a liability is debt and account payable.

Liability can be short term or long term. It is short term if it has to be paid within a year and it is long term if its duration is greater than a year or one accounting period.

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If you were a salesperson, what would be the most challenging part of the sales process for you? Explain.

Answers

The most challenging part for me would be overcoming objections because there are so many possible objections a customer could have. Also if the customer doesn't know their needs this can be even harder to accomplish.

Wanna win 10$ on cashapp??

Answers

Answer:

How can you do this?

Explanation:

Good relationship selling increases

A. customer satisfaction

B. customer qualification

C. word of mouth

D. customer retention

Answers

The answer is customer retention <3

One advantage of a market-product grid is that it can be used to Multiple Choice relate the product life cycle to consumer demand. determine which target market segments to select and which product groupings to offer. screen many new-product ideas in order to select the one with the best long-run market potential. select representative samples of consumers for marketing research studies. make cost-cutting decisions under conditions of uncertainty.

Answers

Answer:

The answer is "relate the product life cycle to consumer demand".

Explanation:

An Ansoff matrix or maybe a project director grid is also considered a consumer product grid. This is tool companies use to build a plan of development. New and existing markets, new and existing products as well as the uncertainties of any potential relationship are addressed,  that's why one of the benefits is to the consumer-product grid is that it could be used to connect probable product sales to future market segments.

Quick Corp. has $270,000 of outstanding accounts receivable. On March 10, Quick assigned to Taft for value (consideration) a $30,000 account receivable due from Pine, one of Quick Corp.'s customers. On March 30, Pine paid Quick Corp. the $30,000. On April 5, Taft notified Pine of the March 10 assignment from Quick to Taft. Taft is entitled to collect $30,000 from Select one: a. Neither Quick nor Pine. b. Quick only. c. Pine only. d. Either Quick or Pine

Answers

Answer:

b. Quick only

Explanation:

According to the given situation, since Taft bank collected the money from Quick corporation as not from Pine because the company would failed to inform pine assignment from quick corporation on time So the taft would be collected from Quick only

Hence, the correct option is b

And, the rest of the options would be considered incorrect

B. A customer sees a house they want, but it's not for sale because it's owned by someone else. How would you go about approaching the current home owner about possibly selling their home to your buyer?

Answers

Answer:

Well typically you would have a realtor contact the home owners. But if u are doing it yourself then you would need to go onto there page that they have it set in call or email them, and they will sign you up for an appointment.

Please mark Brainlyest ❤️

Answer:

you dont

Explanation:

What do you mean by accountability?​

Answers

Accountability is when an individual or department experiences consequences for their performance or actions. Accountability is essential for an organization and for a society. Without it, it is difficult to get people to assume ownership of their own actions because they believe they will not face any consequences.

cellphones are one form of communication technology, give any other form​

Answers

Answer:

television,newspaper,radio,laptops,computer etc..

Answer:

TRANSPORT AND LANDLINES.

For international businesses to achieve vertical differentiation, _____. a. foreign and domestic operations should be grouped in such a way that the company effectively serves the needs of all customers b. top level managers must emphasize flexibility and openness in organizational structure c. a hierarchy of authority must be created that clarifies the responsibilities of both domestic and foreign managers d. the global structure must allow decisions to be made in the most appropriate area of the organization

Answers

Answer:

a hierarchy of authority must be created that clarifies the responsibilities of both domestic and foreign managers

Explanation:

Shelley was initially moderately in favor of a proposal to build a city bike path. At a meeting, she learns that not only will the path provide recreational opportunities and allow for some decrease in traffic, but that in towns with paths, the crime rate tends to go down and businesses along the path do better. She is now strongly in favor of the proposal. The theory that best explains her change of opinion is the __________ theory.

Answers

Answer:

The appropriate response is "Persuasive arguments".

Explanation:

A noninteractional concept or philosophy of community judgment predicting choice results via cognitive or conceptual claims produced by individuals before the debate is determined as Persuasive arguments theory.It doesn't see dialogue as an important element of judgment results, although as a potential mechanism for facilitating communication.

Thus the above is the right answer.

Which of the following aspects of the sales process is most likely to make or break a sale?

A. generating leads

B. qualifying leads

C. establishing rapport

D. assessing needs

Answers

I think it’s c as in cat

6. Identify a change in technology during each of the time periods in history below that you believe improved the
way marketing activities were completed. List the example and explain how it contributed to marketing during
that time.
(a) 1900s to 1930s
(b) 1930s to 1950s
(c) 1950s to 1980s
(d) 1980s to today
Answer:

Answers

Answer:

Prior to the 1950s, the production orientation generally held true due to the growing numbers of affluent and middle class people that capitalism had created.

Say’s Law states that the “production of commodities creates, and is the one and universal cause which creates, a market for the commodities produced”.

The emphasis of firms adopting a production orientation of marketing would have been based on the theory of economies of scale, which are the cost advantages that an enterprise obtains due to expansion.

1. Which of the following BEST defines a down payment?
1. A down payment is a portion of the purchase price that increases the loan amount.
2. The down payment is the good faith escrow deposit.
3. A down payment is a portion of the purchase price that reduces the loan amount.
4. The down payment is the total amount borrowed for purchasing or leasing a car.

Answers

Answer:

3

Explanation:

It has to be this one because it is intial payment to help someone.

1. How does competition affect the prices that airlines charge for fares?

2. How does a lack of competition affect the prices that the train company charges for fares?

Answers

Explanation:

Different routes of the same distance cost different amounts generally not because they cost different amounts to operate, but because of how much the competitors are charging. ... In all, the truth is that prices reflect what people will pay and so people will pay what flights are priced.I don't really know this part tho...

A regional trucking company landed a contract to supply products for a major retailer. To do this, it needs to hire an IT professional to create a shipment database. The new hire should be able to complete which tasks? Check all that apply.

Answers

Answer: • set up the computer hardware for the database.

• Set up the computer software for the database.

• train designated employees to use the database

• protect the confidentiality of the database

Explanation:

The options include:

a. Set up the computer hardware for the database

b. Set up the computer software for the database

c. train designated employees to use the database

d. Design a help page to show people how to use the database

e. protect the confidentiality of the database

Since the new hire is an IT professional who is employed to create a shipment database, the individual should be able to:

• set up the computer hardware for the database.

• Set up the computer software for the database.

• train designated employees to use the database

• protect the confidentiality of the database

Answer:

ACD :))

Explanation:

"Market Equilibrium" is...
A. The quantity where no more buyers want to buy stock
B. The price range where the quantity supplied equals the quantity demanded
C. What happens when there are the same number of buyers and sellers
D. Where the most trades are made

Answers

Answer: B

Explanation: Market equilibrium is when the quantity demanded and quantity supplied are equal

hope this helps good luck :))

2.____What is auto insurance based on in IL?
A. How much money you have
B. Fault
C. Your job
D. How tall you are

Answers

i think it’s B, but i’m not 100%

QUESTION 8 of 10: In a percentage lease, the landlord receives a
a) Assets
b) Expenses
c) Accounts payable
O d) Revenue
Submit

Answers

Answer:

d)revenue

Explanation:

the landlord receives a percentage of revenue earned from any business in addition to the base rent.

In a percentage lease, the landlord receives a revenue. Option d is correct.

What is percentage lease?

A percentage lease is defined as one in which the tenant pays a base rent plus a percentage of any money generated while operating a company on the rental property.

A percentage lease pays the landlord a percentage of any business's revenue in addition to the base rent.

In comparison to a standard lease, the base rent is usually lower. The lower base rent is balanced out by the higher upside potential of a percentage lease.

Therefore, option d is correct.

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Examples of countries that operate under the free market economy​

Answers

Answer:United kingdom

Explanation:

Kamal, Kamala, Krishna invert a sum of RS= 30,000 on a business in the ratio 2 : 3 : 5. Find the each of their investment.​

Answers

Answer:

3000kamal

9000kamala

15000krishna

Explanation:

let the unknown investment be x

now

2x+3x+5x=30000

10x=30000x

x=30000/10

x=3000

again;

2x=2×3000=6000

3x=3×3000=9000

5x=5×3000=15000

wise it is correct

Answer:

Kamal

2×30000÷10 = 6000

Kamala

3×30000÷10= 9000

Krishna

5×30000÷ 10= 15000

Explanation:

Kamal _ RS = 6000

Kamala _RS =9000

Krishna _RS=1,5000

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