+1-415-670-9189
info@expertsmind.com
What is the required rate of return on stock
Course:- Financial Management
Reference No.:- EM13942925




Assignment Help
Assignment Help >> Financial Management

Stock A has a beta of 1.30, and its required return is 13.25%. Stock B's beta is 0.90. If the risk-free rate is 4.75%, what is the required rate of return on B's stock? (Hint: First find the market risk premium.)

1. 10.63%

2. 7.69%

3. 12.08%

4. 9.28%

5. 10.28%




Put your comment
 
Minimize


Ask Question & Get Answers from Experts
Browse some more (Financial Management) Materials
“Before there was Paris Hilton, there was Consuelo Vanderbilt Balsan – a Gilded Age heiress and socialite, renowned for her beauty and wealth. Calculate the annual compound gr
Statements about the flexibility, cost and riskiness of short-term versus long term debt depend to a large extent on the type of short-term financing that is actually used. Th
In light of the Enron, Worldcom, option back dating, government bailouts/nationalizations and Madoff scandals, do you think U.S. equity markets are cleaner and more reliable t
Discuss why productivity is important, particularly in a healthcare organization. How do staffing models and labor optimization algorithms contribute towards productivity??
Harper Hospital is trying to decide whether to lease or purchase new equipment for its dermatology unit. The lease would require payments of $1,000 at the beginning of each mo
A food processing company knows that it will buy 1 million bushels of corn in three months. The standard deviation of the change in the price per b of bushel over a 3-month pe
You are going to value Lauryn's Doll Co. using the FCF model. After consulting various sources, you find that Lauryn has a reported equity beta of 1.7, a debt-to-equity ratio
A stream of pavements over a 5 year period have a present worth of $100,000. Payments in years 1, 4 and 5 are $15,000, $30,000, and $35,000. The value in years 2 and 3 must be