Determine the beta coefficient for stock

Assignment Help Financial Management
Reference no: EM131317374

Beta coefficient

Given the following information, determine the beta coefficient for Stock L that is consistent with equilibrium: = 12.5%; rRF = 5.1%; rM = 12%. Round your answer to two decimal places.

Reference no: EM131317374

Questions Cloud

How new is the e-business concept : Many state that e-commerce is not new, that it may have changed how companies do business, but it simply has not changed the fundamentals of business. With this in mind, how new is the e-business concept?
How to determine the level of risk management appropriate : Imagine the team working on the satellite development project was a virtual team in which team members were unable to meet in person. Explain the expected impact on the project, and suggest two (2) ways the team could maintain its current goal in ..
Expectations theory and inflation : Suppose 2-year Treasury bonds yield 4.8%, while 1-year bonds yield 2.6%. r* is 1.5%, and the maturity risk premium is zero. Use minus sign for any negative expected inflation rate. Using the expectations theory, what is the yield on a 1-year bond 1 y..
What are the benefits of just in time techniques : What are the benefits of just-in-time (JIT) techniques?- What types of organisations use JIT techniques?- Should things change if they are running smoothly?
Determine the beta coefficient for stock : Given the following information, determine the beta coefficient for Stock L that is consistent with equilibrium: = 12.5%; rRF = 5.1%; rM = 12%.
Should things change if they are running smoothly : Also discuss whether the potential benefits-and drawbacks-of such JIT techniques are limited to large manufacturing businesses or whether they have wider applications for other organisations.
Explain the components of the whistleblower protection act : Explain the components of the Whistleblower Protection Act and describe how it works.What elements of law are important for Luke Sheldon to consider in advancing his case?Explain the components of the False Claims Act and whether Luke Sheldon can ben..
How individual securities affect portfolio risk : Why is it important to know how individual securities affect portfolio risk? How can portfolio risk be mitigated and why is this important?
Expected interest rate-what is yield on seven year treasury : The real risk-free rate is 2.05%. Inflation is expected to be 2.3% this year, 3.9% next year, and 2.95% thereafter. The maturity risk premium is estimated to be 0.05(t - 1)%, where t = number of years to maturity. What is the yield on a 7-year Treasu..

Reviews

Write a Review

Financial Management Questions & Answers

  Net annual rate of return to the nearest basis point

You have $16,000 to invest in a mutual fund with a NAV = $45. You choose a fund with a 4% front load, a 1% management fee, and a 0.25% 12b-1 fee. Assume that the management and 12b-1 fees are charged on year-end assets. The gross annual return on the..

  Capital gains yield-share based on a market rate of return

The Toy Chest pays an annual dividend of $4.80 per share and sells for $93.20 a share based on a market rate of return of 15 percent. What is the capital gains yield?

  Firm earnings per share after recapitalization

The Rivoli Company has no debt outstanding, and its financial position is given by the following data: Assets (Market value = book value) $3,000,000 EBIT $500,000 Cost of equity, rs 10% Stock price, Po $15 Shares outstanding, no 200,000 Tax rate, T (..

  Should require maintenance costs

A forklift will last for only 3 more years. It costs $6,400 a year to maintain. For $19,000 you can buy a new lift that can last for 10 years and should require maintenance costs of only $3,400 a year. Should you replace the forklift if the cost of c..

  The equipment is worth-what is the cost of leasing

Waldrop Corporation must install $200 of new equipment in its Ohio plant. It can obtain a bank loan for 100% of the required amount at 3% interest on the loan. Alternatively, the firm can leas the equipment on a 2-year lease, the payment would be $11..

  Negative message assignment

Seven years ago, you cut costs for employee health insurance by switching from open-ended insurance to health maintenance organizations (HMOs). At that time, you kept open-ended insurance for retirees because your employees told you that retirees wan..

  What is the dividend yield for each of these four stocks

Consider four different stocks, all of which have a required return of 12 percent and a most recent dividend of $3.00 per share. Stocks W, X, and Y are expected to maintain constant growth rates in dividends for the foreseeable future of 10 percent, ..

  Conviction about the stock price future movement

The common stock of the Avalon Corporation has been trading in a narrow range around $40 per share for months, and you believe it is going to move away sharply from the range in the next 3 months. What would be a simple options strategy using a put a..

  Long-term financing needed-what was total long-term debt

At year-end 2013, Wallace Landscaping’s total assets were $1.4 million and its accounts payable were $415,000. Sales, which in 2013 were $2.6 million, are expected to increase by 30% in 2014. What was Wallace's total long-term debt in 2013? How much ..

  Assuming a forecast bias of costs and cash flows

RV Ventures has designed a new fuel efficient motor for their deluxe RV. Product development will continue for the next four years at an estimated cost of $250,000 annually, with the first payment to be made immediately. Assuming a forecast bias of +..

  Forecasting interest rates based on prevailing

forecasting interest rates based on prevailing conditions.consider the prevailing conditions for the following factors

  Calculate its average and marginal costs for volume ranging

Sweetwater Nursing Home has 150 beds. Its cost and volume data are as follows. Calculate its average and marginal costs for volume ranging from 100 to 140. What patterns do you see? How would the average and marginal costs change if the phlebotomist’..

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