Which of the following is most likely to occur

Reference no: EM13263807

Assume that the risk-free rate remains constant, but the market risk premium declines. Which of the following is most likely to occur?

The required return on a stock with beta = 1.0 will not change.
The required return on a stock with beta > 1.0 will increase.
The return on "the market" will remain constant.
The return on "the market" will increase.
The required return on a stock with beta < 1.0 will decline.

Reference no: EM13263807

Questions Cloud

Find the duration of the plans obligations : A pension plan is obligated to make disbursements of $3.0 million, $3.8 million, and $3.0 million at the end of each of the next three years, respectively. Find the duration of the plan's obligations if the interest rate is 9% annually.

What does the p-value in your spss output tell you : Produce the scatter plot for x3 and y3. Do you think there are any outliers?Calculate the correlation coefficient (r) for all the data points What does the p-value in your SPSS output tell you?

What is the torsion constant of the hairspring : A certain alarm clock ticks four times each second, with each tick representing half a period. What is the torsion constant of the hairspring

Which stock should this investor add to his or her portfolio : However, Stock A's standard deviation of returns is 12% versus 8% for Stock B. Which stock should this investor add to his or her portfolio, or does the choice not matter?

Which of the following is most likely to occur : Assume that the risk-free rate remains constant, but the market risk premium declines. Which of the following is most likely to occur?

Which of the following events would reduce its wacc : The company uses the CAPM to calculate its cost of equity, and its target capital structure consists of common stock, preferred stock, and debt. Which of the following events would REDUCE its WACC?

Compute the electron current in the filament : The current in a 100 watt lightbulb is 0.770A . The filament inside the bulb is 0.300mm in diameter. What is the electron current in the filament

Are cell phones good or bad for the environment : Write an essay on "are cell phones good or bad for the environment? And why?"

How much would it cost him to buy the annuity today : Your father is about to retire, and he wants to buy an annuity that will provide him with $85,000 of income a year for 25 years, with the first payment coming immediately. The discount rate on such annuities is 5.15%. How much would it cost him to..

User Account

All Pages