Assume that in recent years both expected inflation and the market risk premium (rm − rrf) have declined. assume also that all stocks have positive betas. which of the following would be most likely to have occurred as a result of these changes? a. the required returns on all stocks have fallen, but the fall has been greater for stocks with higher betas. b. the average required return on the market, rm, has remained constant, but the required returns have fallen for stocks that have betas greater than 1.0.c. required returns have increased for stocks with betas greater than 1.0 but have declined for stocks with betas less than 1.0.d. the required returns on all stocks have fallen by the same amount. e. the required returns on all stocks have fallen, but the decline has been greater for stocks with lower betas.

Rahm's credit card issuer calculates interest based on the outstanding balance at the end of the last billing period. what is this method of calculating interest on a credit card called?

Total marketing effort is a term used to describe the critical decision factors that affect demand: price, advertising, distribution, and product quality. define the variable x to represent total marketing effort. a typical model that is used to predict demand as a function of total marketing effort is based on the power function: d = axb suppose that a is a positive number. different model forms result from varying the constant b. sketch the graphs of this model for b = 0, b = 1, 0< b< 1, b< 0, and b> 1. (we encourage you to use excel to do this.) what does each model tell you about the relationship between demand and marketing effort? what assumptions are implied? are they reasonable? how would you go about selecting the appropriate model?

Activity-based costing (abc) is not truly a cost collection mechanism as much as it is an inventory valuation method. the main purpose for implementing an activity-based cost system is to try to overcome some of the cost distortions that occur in traditional costing from product differences when there are variations in size and complexity. however, one of the disadvantages of utilizing abc is that the additional information gathering necessary to implement costing with that level of detail might be beyond the reach of some companies with resource or financial constraints. with this in mind, what kinds of industries or companies do you think would benefit most from using activity-based costing and why? in designing or modifying an accounting system to capture appropriate costs for abc, what considerations do you think would need to be made?