What is the systemic risk for this stock

Assignment Help Financial Management
Reference no: EM13943773

If we have Stock A with required rate of return each to 15%, risk free rate of reture is 3%, the expected return for the market portfolio is 7%.

a. what is the systemic risk for this stock

b. does this stock have higher or lower risk than the market

c. what is the market risk premium

d. what is risk premium of stock A

Reference no: EM13943773

Questions Cloud

What is the current price per share if the required return : Whistle Stop Trains pays a constant $16 dividend on its stock. The company will maintain this dividend for the next 14 years and will then cease paying dividends forever. What is the current price per share if the required return on this stock is 15 ..
New machine which will reduce manufacturing costs : Stanton Inc. is considering the purchase of a new machine which will reduce manufacturing costs by $5,000 annually and increase sales by $6,000 annually. Stanton will use the MACRS method to depreciate the machine, and it expects to sell the machine ..
Four-year project to improve production efficiency : Warmack Machine Shop is considering a four-year project to improve its production efficiency. Buying a new machine press for $440,000 is estimated to result in $175,000 in annual pretax cost savings.  Calculate the NPV of this project.
Peroni company paid wages : Peroni Company paid wages of $170,900 this year. Of this amount, $114,000 was taxable for net FUTA and SUTA purposes. The state's contribution tax rate is 3.1% for Peroni Company.
What is the systemic risk for this stock : If we have Stock A with required rate of return each to 15%, risk free rate of reture is 3%, the expected return for the market portfolio is 7%. what is the systemic risk for this stock. does this stock have higher or lower risk than the market. what..
Write a concise summary about physical tamper-resistant : Write a concise summary (ideally one to two pages) of what you have learned about physical tamper-resistant devices.
Produces a flue gas which analyses : A hydrocarbon liquid fuel (containing only C and H2) is burnt in air which produces a flue gas which analyses ( orsat analysis ) on dry basis as CO2 =10.5% , O2 = 5% and N2 =84.5%.
Describe various types of data resources and data processing : Identify and briefly describe 3-4 various types of data resources, data processing, and/or storage systems used in today's business environments that you think are most relevant and important. Explain your rationale
Weighted average that implied by two outstanding debt issues : Dinklage Corp. has 4 million shares of common stock outstanding. The current share price is $70, and the book value per share is $5. The company also has two bond issues outstanding. Suppose the most recent dividend was $4.20 and the dividend growth ..

Reviews

Write a Review

Financial Management Questions & Answers

  Se straight-line depreciation to zero over the projects life

You are evaluating two different silicon wafer milling machines. The Techron I costs $213,000, has a three-year life, and has pretax operating costs of $54,000 per year. The Techron II costs $375,000, has a five-year life, and has pretax operating co..

  Calculate the average amount of time customer waits in line

A grocery store estimates that customers arrive at the rate of 15 per hour. The cashier can serve customers at a rate 20 per hour. Calculate the average amount of time customer waits in a line (in minutes)

  Compare and contrast the era of classical budgeting

What factors led (in Wildavsky’s terms) to the Collapse of Budgetary Consensus that occurred in the 1970s? Define his consensus, and then compare and contrast the Era of Classical Budgeting with U.S. national budgeting under the 1974 Budget and Impou..

  Explaining net present value and future value

You have been asked by a manager in your organization to put together a training program explaining Net Present Value (NPV) and Future Value (FV) and how they are used to evaluate the price of stock. Give an example of how to use the formulas for NPV..

  What is the expected return on the portfolio

You own a portfolio that has $3,600 invested in Stock A and $4,600 invested in Stock B. If the expected returns on these stocks are 10 percent and 13 percent, respectively, what is the expected return on the portfolio?

  Ebit and leverage

EBIT and Leverage. Kaelea, Inc., has no debt outstanding and a total market value of $125,000. Earnings before interest and taxes, EBIT, are projected to be $10,400 if economic conditions are normal. If there is strong expansion in the economy, then ..

  What is the investors overall profit and loss

On Dec 31 an investor longs 18 contracts of Gold with a settlement price of 1185.40. What is the investors overall profit/loss? The contract size is 100 troy oz

  What is the net present value of each of the projects

Calculate the IRR for each of the projects. If the discount rate for all three projects is 10 percent, which project or projects would you want to undertake? What is the net present value of each of the projects where the appropriate discount rate is..

  About the bond yields

Bond Yields. A bond with face value $1,000 has a current yield of 6% and a coupon rate of 8%. (LO6-1) a. If interest is paid annually, what is the bond’s price? b. Is the bond’s yield to maturity more or less than 8%?

  Compute the price of bonds based on semiannual analysis

You are called in as a financial analyst to appraise the bonds of Olsen’s Clothing Stores. The $1,000 par value bonds have a quoted annual interest rate of 10 percent, which is paid semiannually. Compute the price of the bonds based on semiannual ana..

  Discuss the difference between book values and market values

Discuss the difference between book values and market values and explain which one is more important to the financial manager and why.

  Compute the cost of internally generated equity

Given the following, compute the cost of internally generated equity (retained earnings) using the CAPM approach: The par value of the firms outstanding 20 year 8% annual coupon debt is 1,000 and the debt currently has a market value of 800.

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