Not register? Register Now!
Essay Available:
Pages:
2 pages/≈550 words
Sources:
3 Sources
Level:
APA
Subject:
Visual & Performing Arts
Type:
Coursework
Language:
English (U.S.)
Document:
MS Word
Date:
Total cost:
\$ 8.64
Topic:

# Finance (MOD3CA) (Coursework Sample)

Instructions:
Content:
RISK AND RETURN. 1. (a). When a large fire severely damages three major U.S cities, the entire economy will not be affected by the fire outbreak in the three major cities. The companies in other cities that are not affected by the fire will meet the demand that is not met by the companies in the three major U.S cities that are affected by the fire. The component of the assets total risk can be diversified away hence is termed as diversifiable risk. (b). When there is a substantial unexpected rise in the price of oil, there will be an increase in the inflation rate that will have detrimental impacts to the entire economy and all the companies. The component of the assets total risk cannot be diversified away and therefore is termed as non-diversifiable risk. (c). When a bridge on a major highway collapses and the repairs on the bridge takes up to a year to complete, there will be no effect on the entire economy. The companies located in areas not affected by the bridge collapse will be able to transport their output at the expense of the companies that will not be able to transport their goods due to bridge collapse. This is termed as a diversifiable risk since the component of the assets total risk can be diversified away. 2 (a).CAPM (Capital Asset Pricing Model) equation Given that the Expected Rate of Return on Asset “i” is 12%, the Risk Free Rate is 5 %, and the Beta (b) for Asset “i” is 1.5 The Expected Rate of Return on the Market Portfolio is calculated as follows. Risk Free Rate = r f =5% Beta of Stock = beta A = 1.5 Requir...
Get the Whole Paper!
Not exactly what you need?
Do you need a custom essay? Order right now:

### Other Topics:

• American Art History. Hudson River School Painters
Description: High School Coursework: American Art History. Hudson River School Painters...
1 page/≈275 words | 1 Source | APA | Visual & Performing Arts | Coursework |
• Life Review Essay
Description: LIFE REVIEW ESSAY Art Coursework...
2 pages/≈550 words | No Sources | APA | Visual & Performing Arts | Coursework |