What is the expected rate of return on a stock

Assignment Help Finance Basics
Reference no: EM13263718

The risk-free rate of return is 3.0 percent and the market risk premium is 10 percent. What is the expected rate of return on a stock with a beta of 1.2?

Reference no: EM13263718

Questions Cloud

What is the price-earnings ratio : A company has $5,800 in sales. The profit margin is 4%. There are 5,000 shares of stock outstanding. The market price per share is $1.70. What is the price-earnings ratio?
Calculate the partial pressure of each gas in the mixture : A container of volume V is divided by partitions into three parts containing one kilomole of helium gas, Calculate the kilomole fraction and the partial pressure of each gas in the mixture
What is the return on equity : A firm has sales of $3,550, total assets of $3250, and a profit margin of 4%. The firm has a total debt ratio of 40%. What is the return on Equity?
Development of a group intervention for teens : Adolescents with Type 1 diabetes (DM1) are at significant risk for depression compared to their non-diabetic counterparts and frequently demonstrate poor glycemic control
What is the expected rate of return on a stock : The risk-free rate of return is 3.0 percent and the market risk premium is 10 percent. What is the expected rate of return on a stock with a beta of 1.2?
What must be the dividend yield : Shares of common stock of the Samson Co. offer an expected total return of 21.2%. The dividend is increasing at a constant 5.8% per year. What must be the dividend yield?
What is the speed of the ligth ray in the solution : A light ray with an incident angle of 38.5 degrees crosses from air to a solution and has an angle of refraction of 21.9 degrees. What is the speed of the ligth ray in the solution
Whether current is flowing clockwise or counterclockwise : A conducting filament containing a small 400 ohm resistor is formed into a square loop on the x-y plane as explained in the previous problem. Find I at t = 2*10^-4 sec if (a) \(B = 3cos(12000\pi t)a_z T\)
How are market conditions in the us and the company country : How are market conditions in the US and the company's country of origin factored? Why is it important to perform a post-IPO risk and growth analysis?

Reviews

Write a Review

Finance Basics Questions & Answers

  Costs of financial distress

The Salad Oil Storage Company (SOS) has financed a large part of its facilities with the long-term debt. There is the significant risk of default, but company isn't on the ropes yet. Describe

  What is the required return of abc stock

The risk free rate of interest is 6%. The overall stock market has an expected return of 12%. ABC Stock has a beta of 1.2%. What is the required return of ABC Stock.

  Inflation forecast

On August 1st 2009 USD/SAR exchange rate was SAR9.20 per USD. On August 1st 2010 (1 year later), USD/SAR rate moved up to USD/SAR9.80.

  Distributions to shareholders

Mention and briefly discuss two motivations that would lead the firm to engage in stock repurchase versus a straight cash dividend. In brief describe the implications of tradeoff between dividends and free cash flow retention.

  Establishment of a lockbox system

Linkup Systems, which provides shareholders with computerized information about stock prices, is planning the establishment of a lockbox system with its bank.

  What is the current value of a share of chyrox

What is the current value of a share of Chyrox if its current dividend is $1.50 and dividends are expected to grow at an annual rate of 20% for the next 5 years?

  Calculate the dividend yield

Suppose you expect a share of stock to pay dividends of $1.00, $1.25, and $1.50 in each of next three years. You believe the stock will sell for $20 at the end of third year

  Computation of weighted average cost of capital

Computation of weighted average cost of capital and calculate the weighted average cost of capital for Dell using book value weights and market value weights assuming Dell has a 35% marginal tax rate

  Find the change in credit terms

Epstein Corporation, a wholesale distributor of jewelry, sells to retail jewelry stores on terms of "net 120." Its average collection period is 150 days. The company is considering the introduction of a 4% cash discount if the customer pays within th..

  Determining the cost of equity

What is the value of the firm according to MM with corporate taxes? What is the firm's cost of equity? The firm's gain from leverage according to the Miller model is $126,667. If the effective personal tax rate on stock income is 20 percent, what i..

  Impact of ratios

A company faces financial pressures from attempting to increase too rapidly. Which of the following ratios would you expect to be impacted the most by these pressures?

  Multinational firms and capm

What is the capital asset pricing model? What is the basic message of the CAPM?

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