Finance Case

Alexandra G. Bonnevie | | | | | | |

2011-01095BA 142Prof. Agustin | | | | | | | | |

Case: Analyzing Risk and Return on Chargers Products' Investments | | | |

| | | | | | | | | |

a. | | | | | | | | | |

Expected Rate of Return: (Pt - Pt-1 + Ct) | | | | | | |

| | Pt1 | | | | | | | |

Asset X: | | | | | | | | | |

Year | | Ct | Pt | Pt-1 | | Gain | | Annual Return Rate (%) | | |

1994 | | 1000 | 22000 | 20000 | | 2000 | | | 15 | | | |

1995 | | 1500 | 21000 | 22000 | | -1000 | | | 2.27 | | | |

1996 | | 1400 | 24000 | 21000 | | 3000 | | | 20.95 | | | |

1997 | | 1700 | 22000 | 24000 | | -2000 | | | -1.25 | | | |

1998 | | 1900 | 23000 | 22000 | | 1000 | | | 13.18 | | | |

1999 | | 1600 | 26000 | 23000 | | 3000 | | | 20 | | | |

2000 | | 1700 | 25000 | 26000 | | -1000 | | | 2.69 | | | |

2001 | | 2000 | 24000 | 25000 | | -1000 | | | 4 | | | |

2002 | | 2100 | 27000 | 24000 | | 3000 | | | 21.25 | | | |

2003 | | 2200 | 30000 | 27000 | | 3000 | | | 19.26 | | | |

| | | | | | | | Ave: | 11.735 | | | |

Asset Y | | | | | | | | | |

Year | | Ct | Pt | Pt-1 | Gain | | Annual Return Rate (%) | | | |

1994 | | 1500 | 20000 | 20000 | 0 | | | 7.5 | | | | |

1995 | | 1600 | 20000 | 20000 | 0 | | | 8 | | | | |

1996 | | 1700 | 21000 | 20000 | 1000 | | | 13.5 | | | | |

1997 | | 1800 | 21000 | 21000 | 0 | | | 8.57 | | | | |

1998 | | 1900 | 22000 | 21000 | 1000 | | | 13.81 | | | | |

1999 | | 2000 | 23000 | 22000 | 1000 | | | 13.64 | | | | |

2000 | | 2100 | 23000 | 23000 | 0 | | | 9.13 | | | | |

2001 | | 2200 | 24000 | 23000 | 1000 | | | 13.91 | | | | |

2002 | | 2300 | 25000 | 24000 | 1000 | | | 13.75 | | | | |

2003 | | 2400 | 25000 | 25000 | 0 | | | 9.6 | | | | |

| | | | | | |...