Given that First Bancorp was down by 80 percent for 2010, why did some investors hold the stock? Why didn’t they sell out before the price declined so sharply?
Answer to relevant QuestionsIf a market is semi strong form efficient, is it also weak form efficient? Explain.A stock has had returns of 14 percent, 18 percent, 26 percent, −19 percent, 34 percent, and −9 percent over the last six years. What are the arithmetic and geometric returns for the stock?Based on the following information, calculate the expectedreturn:A stock has an expected return of 12.4 percent, its beta is 1.17, and the risk-free rate is 4.2 percent. What must the expected return on the market be?Why do we use an after tax figure for cost of debt but not for cost of equity?
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