Find the Variance for a Security That Has Three One-Year

question 109

Multiple Choice

Find the variance for a security that has three one-year returns of 5%,10%,and 15%.

• A)10.00%
• B)16.67%
• C)25.00%
• D)30.00%

Recognize the diversity of capital budgeting evaluation methods.

Grasp the application and limitations of the internal rate of return method, especially with uneven cash flows.

Comprehend the net present value method and its relevance to capital budgeting.

Evaluate the risk associated with technology investments in capital budgeting.

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Definitions:

Plows

Agricultural tools used for turning over the soil, typically to prepare it for planting crops by cutting, lifting, and overturning it.

Fertilizers

Substances added to soil to improve its fertility by supplying essential nutrients to plants, including nitrogen, phosphorus, and potassium compounds.

Digging Sticks

Simple tools used since ancient times for breaking the ground for planting seeds or for digging up roots and tubers.

Plows

Agricultural tools used for turning over the soil to prepare it for planting seeds by cutting, lifting, and turning over the soil.