Reference no: EM1313986

 

Q1) Required rate of return suppose that risk-free rate is 6% and expected return on market is 13%. Determine the required rate of return on the stock with a beta of 0.7?

 

Q2) Beta and required rate of return stock has required return of 11%; risk-free rate is 7%t; and market risk premium is 4 %.

 

a) Determine the stock's beta?

 

b) Is market risk premium increased to 6%, what would occur to stock's required rate of return?

 

Suppose risk-free rate and beta remain unchanged

 

Q3) 4 research participants take test of manual dexterity (high scores mean better dexterity) and the anxiety test (high scores mean more anxiety). Scores are as follows:

 

Person	Dexterity	Anxiety
1	1	10
2	1	8
3	2	4
4	4	-2

 

Figure whether correlation is statistically significant (use the: 05 significance level, two-tailed).