Estimate expected return on the stock

Reference no: EM1365065

Suppose the expected return on the market is 13.8 percent and the risk-free rate is 6.4 percent. Carib inc. stock has a beta of 1.2.

a. what is the expected return on the carib stock

b. if the risk free rate decreases to 3.5 percent, what is the expected return on the carib stock.

Reference no: EM1365065

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