b) Amelia has $50,000 cash on hand today. She plans to set up an investment portfolio...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
b) Amelia has $50,000 cash on hand today. She plans to set up an investment portfolio today. She wants to invest $11,000 in Share A and $13,000 in Bond B. The remaining amount will be invested in a 12-month term deposit which pays interest at 3% p.a. effective. Over the following 12 months, share A's expected return is 15%. Bond B's expected return is 6%. Calculate the expected return for Amelia's investment portfolio over the following 12 months. (Round your answer to the nearest 0.01%) (3 marks) b) Amelia has $50,000 cash on hand today. She plans to set up an investment portfolio today. She wants to invest $11,000 in Share A and $13,000 in Bond B. The remaining amount will be invested in a 12-month term deposit which pays interest at 3% p.a. effective. Over the following 12 months, share A's expected return is 15%. Bond B's expected return is 6%. Calculate the expected return for Amelia's investment portfolio over the following 12 months. (Round your answer to the nearest 0.01%) (3 marks)
Expert Answer:
Answer rating: 100% (QA)
Total investment 50000 Investment in share A 11000 Investment in share B 13000 Investment in term de... View the full answer
Related Book For
Probability and Statistical Inference
ISBN: 978-0321923271
9th edition
Authors: Robert V. Hogg, Elliot Tanis, Dale Zimmerman
Posted Date:
Students also viewed these accounting questions
-
Suppose that the probability of a head on any toss of a certain coin is p (0
-
Suppose the newspaper states that the probability of rain today is 30%. What is the complement of the event "rain today"? What is the probability of the complement?
-
Suppose a government study estimated that the probability of successive generations of a rural family remaining in a rural area was 0.7 and the probability of successive generations of an urban...
-
(b) (i) A long single mode optical fiber has an attenuation of 0.40 dBkm when operating at a wavelength of 1.55 m. The fiber core diameter is 6 pm and the laser source bandwidth is 500 MHz. Determine...
-
The positive random variable X is said to be a lognormal random variable with parameters and 2 if log(X) is a normal random variable with mean and variance 2. Use the normal moment generating...
-
What is Feigenbaum's constant? A DOF system with a cubic nonlinearity has a linear natural frequency of \(120 \mathrm{rad} / \mathrm{s}\). The system is forced by harmonic excitations at different...
-
A sample of size 15 is drawn from a normal population. The sample standard deviation is s1 = 5.2. A sample of size 10 is drawn from another normal population. The sample standard deviation is s2 =...
-
Babbit, Inc., a multinational corporation based in the United States, owns an 80% interest in Nakima Company, which is located in Sydney, Australia. The acquisition occurred on January 1, 2008. The...
-
1. Black-Scholes-Merton Option Pricing: Use EXCEL to answer this question. Suppose that Lewis & Co. (LEW) stock is trading at $86.75. The annualized standard deviation of daily returns for LEW is...
-
You work in the human resources department of your company helping new employees fill out the necessary paperwork to get their first paycheck. There are a number of decisions that employees must make...
-
The different types of amniotic eggs (lecithotrophic and matrotrophic).
-
Name the legislations which underpin workplace and organisation policies and some procedures. ? Explain
-
Consider the following $ 1 , 0 0 0 face value bond which makes semi - annual coupon payments. Rema Bond CIBC 9 . 5 % Coupon rate Price 1 0 7 . 8 4 Maturity June 1 , 2 0 3 0 Settlement Date January 6...
-
Write a while loop to continually update this approximation (using the same formula from problem 1.1) until the relative approximate error, E = X+1 - X X is less than .00001. Use this approximation...
-
CircuitTown commenced a gift card program in January 2024 and sold $12,550 of gift cards in January, $19,900 in February, and $20,550 in March 2024 before discontinuing further gift card sales....
-
The picture mentions the the Cape Wind project in Nantucket Sound between Nantucket island, Martha's Vineyard, and Cape Cod. Although formally proposed in 2001, this project has been abandoned....
-
Problem 1. Let G = (V UV2, E) be a bipartite graph. We saw in class the maximum size matching of G can be solved by the linear program (P) max Xe s.t. 0 xe Ve E E and Xe1 VueV eE ev
-
The following selected information was taken from Sun Valley Citys general fund statement of revenues, expenditures, and changes in fund balance for the year ended December 31, 2019: Revenues:...
-
For a freshman taking introductory statistics and majoring in psychology, let X equal the students ACT mathematics score and Y the students ACT verbal score. Assume that X and Y have a bivariate...
-
In 2012, Red Rose tea randomly began placing 1 of 12 English porcelain miniature figurines in a l00-bag box of the tea, selecting from 12 nautical figurines. (a) On the average, how many boxes of tea...
-
Let pn, n = 0, 1, 2, . . . , be the probability that an automobile policyholder will file for n claims in a five-year period. The actuary involved makes the assumption that pn+1 = (1/4)pn. What is...
-
Which do you mean by a static force?
-
The lengths of crank and connecting rod of a slider crank mechanism are \(40 \mathrm{~mm}\) and \(100 \mathrm{~mm}\), respectively. It is subjected to piston force of \(2000 \mathrm{~N}\). Determine...
-
A four-bar mechanism is loaded as shown in Fig.11.36. \(A B=C D=300 \mathrm{~mm}\). \(B C=250 \mathrm{~mm}, A E=C G=150 \mathrm{~mm}, B F=100 \mathrm{~mm}, A D=500 \mathrm{~mm}\) Determine the...
Study smarter with the SolutionInn App