Use the information below to answer the following questions: C = 4000 + .75YD I = 2000 G = 1500 T = 1000

Suppose government spending decreases by 200 for the above economy. Given the above information, we know that equilibrium output will decrease by:

a. 1000
b. 200
c. 400
d. 800

The market yield on spice grills' bonds is 15%, and the firm's marginal tax rate is 33%. what is their shareholders' required return if the equity risk premium is 4%?

The total value of your portfolio is $10,000: $3,000 of it is invested in stock a and the remainder invested in stock b. stock a has a beta of 0.8; stock b has a beta of 1.2. the risk premium on the market portfolio is 8%; the risk-free rate is 2%. additional information on stocks a and b is provided below. return in each state state probability of state stock a stock b excellent 15% 15% 5% normal 50% 9% 7% poor 35% -15% 10% what are each stock’s expected return and the standard deviation? what are the expected return and the standard deviation of your portfolio? what is the beta of your portfolio? using capm, what is the expected return on the portfolio? given your answer above, would you buy, sell, or hold the portfolio?

Because the demand for wheat tends to be inelastic. true or false