--%>

Non-tradable asset

Assume there is non-tradable asset along with the perfect positive correlation with a portfolio T of the tradable assets.  How will non-tradable asset be priced?

E

Expert

Verified

Non-tradable asset along with perfect positive correlation with the portfolio T (for tradable) will be priced as if it were tradable itself. Or we can state that it will be priced in accordance with its world systematic risk.

   Related Questions in Financial Accounting

  • Q : Workings and nature of the financial

    Assume that you are really interested in investing in the shares of Nokia Corporation of Finland that is a world leader in the wireless communication. However, before making the investment decision, you might like to learn about company. Take a look of the website of

  • Q : Why teaching of accounting is not simple

    Why teaching of accounting is not simple. Illustrate this statement.

  • Q : Write a Matlab function Fourbar Write a

    Write a Matlab function Fourbar (r1,r2,r3,r4,theta,speed) that animates three cycles of a fourbar linkage having link lengths r1, r2, r3, r4. The function first checks to ensure the mechanism isGrashof (including the change-point c

  • Q : Help Otobai Motor Company is currently

    Otobai Motor Company is currently paying a dividend of $1.40 per year. The dividends are expected to grow at a rate of 18% for the next three years and then a constant rate of 5% thereafter forever. What is the value of its current stock price? Assuming that the discount rate is 10%.

  • Q : How Social Darwinism support business

    What is Social Darwinism and how it was utilized to support business?

  • Q : Advantages and disadvantages of FDI

    State advantages and disadvantages of FDI as opposed to the licensing agreement with the foreign partner?

  • Q : Accountant & Financial In Business

    Questions 1. Identify the services or programs to be included in the cost and profitability analysis. 2. Examine the costs listed in Table 2. a. Identify the direct costs associated with each service or program. b. Which costs would be organization

  • Q : Brokering Creativity Explain the term

    Explain the term Brokering Creativity in Creative industry ?  

  • Q : Internalization theory of FDI Explain

    Explain internalization theory of the FDI. Specify the strength and weakness of this theory?

  • Q : Historical Cost of Fixed Assets What

    What are the Historical Cost of Fixed Assets?