Question
Shares of Hapolonian Industries (HAP) and Zoe Incorporated (ZINC) react differently to the state of the economy. When the economy is doing well, HAP delivers
Shares of Hapolonian Industries (HAP) and Zoe Incorporated (ZINC) react differently to the state of the economy. When the economy is doing well, HAP delivers a return of 10 percent and ZINC delivers a return of 5 percent. When the economy is not doing well, HAP delivers a return of 8 percent and ZINC delivers a return of 8 percent. The probability that the economy is doing well is 60 percent. If Roger, an investor, wants an expected return of 8.9 percent, his portfolio should be...
a.
89 percent HAP and 11 percent ZINC.
b.
Roger cannot achieve his goal because ZINC's expected return is only 6.2 percent.
c.
90 percent HAP and 10 percent ZINC.
d.
85 percent HAP and 15 percent ZINC.
Market demand is given by P = 75 - 2Q and market supply is given by P = 3Q. At the equilibrium price and quantity, the point price elasticity of demand is...
a.
-1.5
b.
-2/3
c.
-3
d.
-2
Clear my choice
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started