mium, RPM, is 5 percent. If the beta coefficient associated with a firm's stock is 2.0, what should be the stock's required rate of return? 11-7 If the risk-free rate of return, rRF, is 4 percent and the market return, rm, is expected to be 12 percent, what is the required rate of return for a stock with a beta, B, equal to 2.5? Required Rate of Return Aa 4) 434 99

Q: According to MSN money, the stock of Orange Corporation has a beta of 1.5, but according to Yahoo…

A: Beta coefficient shows the systematic risk of the assets. The beta factor shows the systematic risk…

Q: The Treasury bill rate is 4%, and the expected return on the market portfolio is 12%. Using the…

A: Risk free rate = 4% Market return = 12% Beta of stock X = 1.5

Q: The risk-free rate is 3.4 percent and the market expected return is 11.9 percent. What is the…

A: The expected return of a stock can be found out using the CAPM formula. Given, Rf = Risk free…

Q: Stanley Corp. common stock has a required return of 17.5% and a beta of 1.75. If the expected risk…

A: In this question we require to calculate the expected return for the market based on CAPM. As per…

Q: A stock has a beta of 1.19 and an expected return of 11.27 percent. If the risk-free rate is 3.4…

A: Given: Beta = 1.19 Expected return = 11.27% Risk free rate = 3.4%

Q: The expected return on the market is 15% and the risk-free rate of return is 5%. If the Beta of the…

A: In given question we need to compute the expected rate of return for stock using CAPM.

Q: the risk free rate is 13% and the market risk premium rM rRF is 4% stock A has a beta of 12, and…

A: Required Rate of Return is the minimum acceptable return on investment sought by individuals or…

Q: Zacher Co.'s stock has a beta of 0.82, the risk-free rate is 4.25%, and the market risk premium is…

A: Required rate of return = Risk free rate + beta * market risk premium

Q: The current risk-free rate of return is 2.5 percent and the market risk premium is 5 percent. If the…

A: The return which the investors are expected in order to invest in specific securities is referred to…

Q: JaiLai Cos. stock has a beta of 0.8, the current risk-free rate is 6.2 percent, and the expected…

A: The provided information are: Beta = 0.80 Expected return = 12% Risk free rate = 6.2%

Q: Alpha Company has a beta of 3.25 and a standard deviation of returns of 27%. The return on the…

A: In this question we require to calculate the risk premium on the market and also required rate of…

Q: JaiLai Cos. stock has a beta of 0.8, the curret risk-free rate is 5.8 percent, and the expected…

A: Beta = 0.8 Risk free rate (Rf) = 5.8% Market return (Rm) = 14%

Q: You are holding a stock which has a beta of 2.0 and is currently in equilibrium. The required return…

A: First we need to find out the risk free rate by using CAPM formula rs =Rf +β*(Rm -Rf) rs =Required…

Q: The risk-free rate of return is 3.7 percent and the market risk premium is 6.2 percent. What is the…

A: The given question can be solved using capital asset pricing model (CAPM)

Q: Stock Ramsay Ltd. has an expected rate of return of 12% and beta of 1. Stock Gordon Ltd. has an…

A: Expected return of Ramsay = 12% Expected return of Gordon = 13% Rf = 5% Rm = 11%

Q: Assume that Home Afrika stock has an expected return of 15%, a required rate of return (RRR) of 12%,…

A: To analyze, the stock is a risk for an investor then standard deviation of both the stock.…

Q: Assume that the risk-free rate is 6 percent and the expected return on the market is 13 percent.…

A: Given details are : Risk free rate (Rf) = 6% Expected return on market (Rm) = 13% Beta of stock =…

Q: According to the CAPM, what is the required rate of return for a stock with a beta of 0.7, when the…

A: To calculate the required rate of return we use the below formula   Required rate of return = Risk…

Q: The risk-free rate of return is 2.5%, the required rate of return on the market is 11.5%, and ABC…

A: The Capital Asset Pricing Model (CAPM) is the model which shows the relationship between the…

Q: Suppose you estimate that stock A has a volatility of 32% and a beta of 1.42, whereas stock B has a…

A: Total risk of the stock can be calculated by squaring the values of the stock volatility. It can…

Q: JaiLai Cos. stock has a beta of 0.9, the current risk-free rate is 6.5 percent, and the expected…

A: Cost of Equity: It is the rate of return which is the least satisfactory return an investor may…

Q: The common stock of Peeta Inc. has an expected return of 15.0%, the risk-free rate is 3.20%, and the…

A: The return which a company decides as a cost if an investment meets its capital requirement is…

Q: If the expected return from the market is 18%, the risk-free rate is 11%, and the beta of Loschert…

A: The term beta of a stock represents the responsiveness of a particular stock in relation to the…

Q: JaiLai Cos. stock has a beta of 0.7, the current risk-free rate is 6.1 percent, and the expected…

A: CAPM model provides formula that calculates the expected return on stock based on its level of risk.…

Q: The risk-free rate is 6 percent and the expected market risk premium is 8 percent. What is the…

A: Following details are given to us in the question : Risk free rate (Rf) = 6% Beta (B) = 0.7 Market…

Q: Fisher Co.'s stock has a beta of 1.40, the risk-free rate is 4.25%, and the market risk premium is…

A: Required rate of return is defined as the minimum return to the investor, where he will going to…

Q: ZR Corporation’s stock has a beta coefficient equal to 1.8 and a required rate of return equal to 16…

A: Beta =1.8 Required return =16% Market return =10%

Q: Dothan Inc.'s stock has a 25% chance of producing a 16% return, a 50% chance of producing a 12%…

A: Formula: Expected return =∑Chance ×return

Q: Zacher Co.'s stock has a beta of 1.50, the risk-free rate is 4.25%, and the market risk premium is…

A: Given data; beta of stock = 1.50 risk free rate = 4.25% market risk premium = 5.50%

Q: If the expected return on a stock is 6 per cent. Risk free rate of return is 2 per cent and market…

A: Capital asset pricing model (CAPM) formula: Expected return = Risk free rate + (Beta *(Market rate -…

Q: If the risk free rate is 4 9%, the expected return on the market portfolio is 1296 and the beta of…

A: Financial management consists of directing, planning, organizing and controlling of financial…

Q: Cooley Company's stock has a beta of 1.05, the risk-free rate is 2%, and the market risk premium is…

A: Required rate of return = CAPM = Risk free rate  + Market risk premium * beta

Q: ected return for a stock with a beta equal to 0.50?  - What is the marke

A: Given information :

Q: The risk-free rate of return is currently 0.02, whereas the market risk premium is 0.07. If the beta…

A: Capital Pricing Model (CAPM) is an investment theory that shows the relationship between the…

Q: The common stock of Peeta Inc. has an expected return of 15.0%, the risk-free rate is 3.20%, and the…

A: Calculate the beta as follows:

Q: JaiLai Cos. stock has a beta of 0.8, the current risk-free rate is 6.6 percent, and the expected…

A: Formula Cost of equity = Risk free rate+[Beta*(Market return-Risk free rate)] Where Risk free rate =…

Q: Mulherin’s stock has a beta of 1.23, it’s required return is 11.75%, and risk free rate is 4.25%.…

A: Capital Asset Pricing Model (CAPM): CAPM is the method of calculating the expected return on…

Q: The expected rate of return for the stock of Cornhusker Enterprises is 20 percent, with a standard…

A: Expected return: The return anticipated by investor from his investment is called expected return.…

Q: The risk-free rate is 4 per cent. The expected market rate of return is 12 per cent. If you actually…

A: Solution-Risk free rate Rf=4%Expected market rate of return Rm=12%Beta=1.0

Q: If the risk free rate is 4 %, the expected return on the market portfolio is 129% and the beta of…

A: Financial management consists of directing, planning, organizing and controlling of financial…

Q: Please help me with 11-4 ??‍♀️

A: Introduction: Investment in Two stock = 10000 Weight of Stock A = 30% Weight of Stock B = 70% Stock…

Q: Solve the following questions If the expected return on a stock is 10 per cent. Risk free rate of…

A: We need to use CAPM equation to solve these problems. The equation is  Expected return =Risk free…

Q: Everrest Inc.'s stock has a 39% chance of producing a 12.50% return, a 28% chance of producing a…

A: Expected return from the stock is given by E(R) as shown on whiteboard. Here, pi is the probability…