What is the best estimate of the market risk premium

Assignment Help Business Economics
Reference no: EM132281225

If you had access to the following information, what is the best estimate of the market risk premium for use in determining Ke?

  • 5-year Treasury note = 2.9%
  • current stock price = $74.82
  • average annual return on S&P 500 over past five years = 10.3%
  • 6-month Treasury bill rate = 1.8%
  • company's unlevered beta = 1.09
  • tax rate = 27.0%

Enter your answer as a number rounded to the nearest 1st decimal. Do not enter dollar signs, percentage signs, or commas. There is no error range for this question.

For example, if you calculate 9.4382, enter 9.4.

Reference no: EM132281225

Illustrate full income budget constraint on individual

Illustrate the full income budget constraint on an individual who has T0 units of discretionary time, Y0 units of unearned income and a wage rate of W0. In the same diagram, i

Supply upward sloping where the current equilibrium price

Assume we have a market for sodas with Demand downward sloping and Supply upward sloping where the current equilibrium price is $1.25 per can. Now assume that the government i

Products is manufactured through process of customization

Which of the following products is manufactured through the process of customization? Arranging the physical location for the building, workspace, and equipment is part of: __

Database application development

Two of the most important variables that determine the success of a web form is the form design and form field validation. Think about some web forms you might have complete

Linkages between microeconomic decisions and environment

There are linkages between the microeconomic decisions made by managers and the macroeconomic environment. There are numerous examples from the current recession of company la

Computer-controlled milling machine will cost

A computer-controlled milling machine will cost Ajax Manufacturing $65,000 to purchase plus $4700 to install. If the machine would have a salvage value of $6600 at EOY 20, how

Determine the estimated regression line

Consider the Sherwin Williams Company example discussed in this chapter. Suppose one is interested in developing a simple regression model with paint sales (Y) as the dependen

Regulations on financial markets and businesses

Under what circumstances do you think the government will impose greater regulations on financial markets and businesses? When does the government tend to favor deregulation a


Write a Review

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