Required rate of return-risk-free rate

Assignment Help Financial Management
Reference no: EM131014746

Required rate of return

Assume that the risk-free rate is 3.5% and the expected return on the market is 8%. What is the required rate of return on a stock with a beta of 1.2? Round your answer to two decimal places

Reference no: EM131014746

Questions Cloud

Difference between an email client and web-based email : Describe the protection measures you use to keep your computers safe. Antivirus? Firewall? Malware Blockers?
Convert second order ode into system of two first order ode : Convert the second order ODE into a system of 2 first order ODEs in to the form of iT=Au. Find the eigenvalues and eigenvectors of matrix A.
Estimate the percentage of all registered voters : Of a sample of 200 registered voters, 32% report that they intend to vote in a school board election. Using a 95% con?dence interval, estimate the percentage of all registered voters planning to vote.
Developing channels of communication and collaboration : Plans for how your team will communicate and collaborate on this project for the purpose of choosing the best channels of communications for various audiences in the company
Required rate of return-risk-free rate : Assume that the risk-free rate is 3.5% and the expected return on the market is 8%. What is the required rate of return on a stock with a beta of 1.2?
Which gas has the greater final temperature : In the two processes shown in the following figure, the same amount of heat, q, is supplied to the same gas, gas A. In both processes, the initial temperature and initial number of moles are equal. Process 1 occurs at constant volume; process 2 o..
Estimate the percentage of patients : Estimate the percentage of patients throughout the program who were able to ?nd employment within three months. Develop your estimate on the basis of a 99% con?- dence interval.
Expected and required rates of return : Assume that the risk-free rate is 6.5% and the market risk premium is 4%. What is the expected return for the overall stock market? Round your answer to two decimal places. What is the required rate of return on a stock with a beta of 1.8? Round your..
Estimate proportion of all freshmen at university : Estimate the proportion of all freshmen at the university working at least 20 hours per week. Develop your estimate on the basis of a 95% con?dence interval.

Reviews

Write a Review

Financial Management Questions & Answers

  Net asset value-exchange traded funds

Net Asset Value (NAV) of a mutual fund is calculated every day. The book suggests that a closed-end fund (a fund that has a fixed number of shares) can trade above or below the NAV. As an example, someone could invest in Exchange Traded Funds (ETF) o..

  Explain where in the consolidated financial statements

Explain where in the consolidated Financial Statements of Group X would you find evidence of a S i Non Controlling Interest (NCI) using AASB - provide the relevant paragraphs of the AASB Standards for all of the following requirements:

  Compute the future cash flows

Compute Koda's weighted average cost of capital WACC and compute the future cash flows associated with the manufacturing of mobility vehicles and the net present value (NPV) of the project by filling in the blanks in the table below. Advise whether..

  Which bond offers the higher after tax yield

Which bond offers the higher after tax yield? If you also pay a state income tax on taxable coupon interest at a 9 percent rate, but no tax on municipal interest, which bond offers the higher after tax yield?

  Net cash provided by operating activities

Mortiz corporation reported net income of $346,000 cash of $67,800 and net cash provided by operating activities of $221,200 what does this suggest about the quality of the company's earning ? What further steps should be taken?

  Accrual income versus cash flow

Accrual income versus cash flow for a period Thomas Book Sales, Inc., supplies textbooks to college and university bookstores. The books are shipped with a proviso that they must be paid for within 30 days but can be returned for a full refund credit..

  Premerger information about bidding firm-target firm

Consider the following premerger information about a bidding firm (Firm B) and a target firm (Firm T). Assume that both firms have no debt outstanding. Firm B Firm T Shares outstanding 5,600 2,200 Price per share $ 45 $ 19 Firm B has estimated that t..

  Some additional land and build a new assisted living center

Meadow Brook Manor would like to buy some additional land and build a new assisted living center. The anticipated total cost is $23.6 million. The CEO of the firm is quite conservative and will only do this when the company has sufficient funds to pa..

  How long will it be before you have enough to buy the car

You're trying to save to buy a new $204,000 Ferrari. You have $54,000 today that can be invested at your bank. The bank pays 6.2 percent annual interest on its accounts. How long will it be before you have enough to buy the car?

  Most accurate measure of the cost of companys debt

Suess Inc issues a 2-year corporate bond on 31 December, 2012 with a coupon rate of 7.6%, with a face value of $100 and interest paid semi-annually. The most accurate measure of the cost of a company's debt is:

  Assume the forward price satisfies no-arbitrage pricing

What portfolio of options and risk-free asset (if any) can be used to replicate the payoffs of a forward contract on IBM stock with 9 months to maturity? Assume the forward price satisfies no-arbitrage pricing. IBM stock currently trades for $90/shar..

  What would the cash flow diagram look like

If an alternative has an advance payment of $100,000 upon contract award and then quarterly payments of $20,000 for the next 3 years, what would the cash flow diagram look like?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd