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Q1: Suppose Sarah starts her investment portfolio by allocating US$ 25,000 across three assets, stocks A, B and C, as follows:
Stock A: 40% of allocation
Stock B: 32% of allocation
A. At the end of the first year, Stock A returns 15.5%, Stock B returns 11% and Stock C returns 6.3%. Assuming zero trading costs, what is the total return on her portfolio?
B. At the start of year 2, Sarah re-trades across three stocks, allocating the same US$ 25,000 across the same securities, as follows: Stock A allocation of 35.7% of her invested amount, Stock B allocation of 51.0%. At the end of year 2, individual assets returns are -8.0% for Stock A, 9.5% for Stock B, and 14.6% for stock C. Assuming zero trading costs, what is the total return on her new portfolio for that year?
C. If Sarah did not trade at the start of year 2, what would have been her return to portfolio in year 2?
Show your work.

A) At 10:45 a.m., Ashley placed a stop-loss order to sell 200 shares of Alpha stock at $43 a share. At 2:15 p.m., the price of Alpha fell to $42.90 and then rose to $43.40 a share by the end of the trading day. Ashley order was executed that day. Ashley would have received a price:

  1. of $42.90 a share for her stock since her order was already recorded in the designated market maker’s book.
  2. of $43.40 a share for her stock since that was the closing price on the day of execution.
  3. between $42.90 and $43.40 a share depending upon when her trade executed.
  4. equal to the average prices paid by the designated market maker during that trading day.
    Explain your answers.
    b) Angela placed a stop-limit order to sell 100 shares of RST stock at $28 when the market price of RST was $31. Shortly after Angela placed her order, trading on RST was halted due to a pending news announcement. When trading re-opens RST is priced at $24 a share. Within minutes the price of RST began to drop further until it reached $19 a share. Which of the following statements is (are) correct concerning Angela’s stop-limit order to sell?
  5. Angela’s stock was sold for $28 a share.
  6. Angela’s stock was sold for $24 a share.
  7. Angela’s stock was sold at a price between $19 and $24 a share.
  8. Angela still owns her 100 shares of stock.
    Explain your answers.

Q3: Returns on the stock of FBM and MMInc for the years 2017-2020 are shown below.
2017 -18.00% 26.00%
2018 32.00% -5.00%
2019 18.00% 3.00%
2020 1.00% 10.00%
a) Compute the average annual return for each stock and a portfolio consisting of 50% FBM and 50% MMInc.
b) Compute the standard deviation for each stock and the portfolio.
c) Are the stocks positively or negatively correlated and what is the effect on risk?
Explain your answers and show your work.

A) The markets in general are paying a 1% real rate of return. Inflation is expected to be 3%. RJH stock commands an 8% risk premium. What is the expected rate of return on RJH stock? Explain your answer in terms of systematic and idiosyncratic risks, and the relationship between expected (required) market returns and inflation risk.
B) The required rate of return on the RJH common stock is 10%, holding all other assumptions as in (a), what is the risk premium associated with RJH stock? Explain your answer.

Q5: Which of the following will lower required rates of return and why?
a) higher rates of inflation
b) higher risk premiums
c) lower rates of inflation
d) lower dividend yields
e) higher demand for risky assets by investors
f) lower risk-free rate
Explain your answer(s).

Sample Answer

Compelling correspondence is essential to the achievement all things considered but since of the changing idea of the present working environments, successful correspondence turns out to be more troublesome, and because of the numerous impediments that will permit beneficiaries to acknowledge the plan of the sender It is restricted. Misguided judgments.In spite of the fact that correspondence inside the association is rarely completely open, numerous straightforward arrangements can be executed to advance the effect of these hindrances.

Concerning specific contextual analysis, two significant correspondence standards, correspondence channel determination and commotion are self-evident. This course presents the standards of correspondence, the act of general correspondence, and different speculations to all the more likely comprehend the correspondence exchanges experienced in regular daily existence. The standards and practices that you learn in this course give the premise to additionally learning and correspondence.

This course starts with an outline of the correspondence cycle, the method of reasoning and hypothesis. In resulting modules of the course, we will look at explicit use of relational connections in close to home and expert life. These incorporate relational correspondence, bunch correspondence and dynamic, authoritative correspondence in the work environment or relational correspondence. Rule of Business Communication In request to make correspondence viable, it is important to follow a few rules and standards. Seven of them are fundamental and applicable, and these are clear, finished, brief, obliging, right, thought to be, concrete. These standards are frequently called 7C for business correspondence. The subtleties of these correspondence standards are examined underneath: Politeness Principle: When conveying, we should build up a cordial relationship with every individual who sends data to us.

To be inviting and polite is indistinguishable, and politeness requires an insightful and amicable activity against others. Axioms are notable that gracious “pay of graciousness is the main thing to win everything”. Correspondence staff ought to consistently remember this. The accompanying standards may assist with improving courtesy:Preliminary considering correspondence with family All glad families have the mystery of progress. This achievement originates from a strong establishment of closeness and closeness. Indeed, through private correspondence these cozy family connections become all the more intently. Correspondence is the foundation of different affiliations, building solid partners of obedient devotion, improving family way of life, and assisting with accomplishing satisfaction (Gosche, p. 1). In any case, so as to keep up an amicable relationship, a few families experienced tumultuous encounters. Correspondence in the family is an intricate and alluring marvel. Correspondence between families isn’t restricted to single messages between families or verbal correspondence.

It is a unique cycle that oversees force, closeness and limits, cohesiveness and flexibility of route frameworks, and makes pictures, topics, stories, ceremonies, rules, jobs, making implications, making a feeling of family life An intelligent cycle that makes a model. This model has passed ages. Notwithstanding the view as a family and family automatic framework, one of the greatest exploration establishments in between family correspondence centers around a family correspondence model. Family correspondence model (FCP) hypothesis clarifies why families impart in their own specific manner dependent on one another ‘s psychological direction. Early FCP research established in media research is keen on how families handle broad communications data. Family correspondence was perceived as an exceptional scholastic exploration field by the National Communications Association in 1989. Family correspondence researchers were at first impacted by family research, social brain science, and relational hypothesis, before long built up the hypothesis and began research in a family framework zeroed in on a significant job. Until 2001, the primary issue of the Family Communication Research Journal, Family Communication Magazine, was given. Family correspondence is more than the field of correspondence analysts in the family. Examination on family correspondence is normally done by individuals in brain science, humanism, and family research, to give some examples models. However, as the popular family correspondence researcher Leslie Baxter stated, it is the focal point of this intelligent semantic creation measure making the grant of family correspondence special. In the field of in-home correspondence, correspondence is normally not founded on autonomous messages from one sender to one beneficiary, yet dependent on the dynamic interdependency of data shared among families It is conceptualized. The focal point of this methodology is on the shared trait of semantic development inside family frameworks. As such, producing doesn’t happen in vacuum, however it happens in a wide scope of ages and social exchange.

Standards are rules end up being followed when performing work to agree to a given objective. Hierarchical achievement relies significantly upon compelling correspondence. So as to successfully impart, it is important to follow a few standards and rules. Coming up next are rules to guarantee powerful correspondence: clearness: lucidity of data is a significant guideline of correspondence. For beneficiaries to know the message plainly, the messages ought to be sorted out in a basic language. To guarantee that beneficiaries can without much of a stretch comprehend the importance of the message, the sender needs to impart unmistakably and unhesitatingly so the beneficiary can plainly and unquestionably comprehend the data.>

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