A 180-day Bank Accepted Bill has a face value of $1,000,000. The interest rate is 8% pa and there are 365 days in the year. What is its price now?
You really want to go on a back packing trip to Europe when you finish university. Currently you have $1,500 in the bank. Bank interest rates are 8% pa, given as an APR compounding per month. If the holiday will cost $2,000, how long will it take for your bank account to reach that amount?
Stock A has a beta of 0.5 and stock B has a beta of 1. Which statement is NOT correct?
A fairly priced stock has an expected return of 15% pa. Treasury bonds yield 5% pa and the market portfolio's expected return is 10% pa. What is the beta of the stock?
A project's Profitability Index (PI) is less than 1. Select the most correct statement:
Which firms tend to have high forward-looking price-earnings (PE) ratios?
A firm has a debt-to-equity ratio of 25%. What is its debt-to-assets ratio?
Question 711 continuously compounding rate, continuously compounding rate conversion
A continuously compounded semi-annual return of 5% ##(r_\text{cc 6mth})## is equivalent to a continuously compounded annual return ##(r_\text{cc annual})## of:
Question 907 continuously compounding rate, return types, return distribution, price gains and returns over time
For an asset's price to double from say $1 to $2 in one year, what must its continuously compounded return ##(r_{CC})## be? If the price now is ##P_0## and the price in one year is ##P_1## then the continuously compounded return over the next year is:
###r_\text{CC annual} = \ln{\left[ \dfrac{P_1}{P_0} \right]} = \text{LGDR}_\text{annual}###Assume that the market portfolio has a duration of 15 years and an individual stock has a duration of 20 years.
What can you say about the stock's (single factor CAPM) beta with respect to the market portfolio? The stock's beta is likely to be: