Stock XYZ has a beta of 0.50 and Stock ABC has beta of 1.00. According to CAPM, Stock XYZ has a A. higher market risk exposure than stock ABC B. lower required return than stock ABC C. lower realized return than stock ABC D. higher total risk exposure than stock ABC

Q: Stocks X and Y have the following probability distributions of expected future returns: Calculate…

A: Standard deviation: The standard deviation is a measurement of the variance or dispersion of a set…

Q: beta of 1.40 and an expected return of 19%. Stock Z has a beta of 0.65 and an expected return of…

A: We need to compute expected return using CAPM (Capital asset pricing model) for each stock. CAPM…

Q: The expected market rate of return is 12%, and the risk free rate is 3%. Stock A has a beta of 1.25.…

A: Risk free rate = 0.03 Market rate of return = 0.12 Beta = 1.25 Expected return as per CAPM = ?…

Q: A stock has a beta of 1.05, the expected return on the market is 14 percent, and the risk-free rate…

A: Stock Beta is 1.05 Expected return on market is 14% Risk free rate is 7.7% To Find: Expected return…

Q: Fiske Roofing Supplies' stock has a beta of 1.23, its required return is 8.50%, and the risk-free…

A:

Q: Stock A has an expected return of 7%, a standard deviation of expected returns of 35%, acorrelation…

A: Investments in securities result in risk. No investment guarantees profit. Analyzing risk before…

Q: A stock has an expected return of 7.8 percent. The expected return on the market is 9 percent and…

A: Beta less than 1 signifies less systematic risk.

Q: A stock has a beta of 0.8 and an expected return of 10.6 percent. If the risk-free rate is 2.7…

A: Given: Beta =0.8Expected return =10.6% Risk free rate =2.7%

Q: Stock X has a 10% expected return, a beta coefficient of0.9, and a 35% standard deviation of…

A: “Hey, since your question has multiple sub-parts, we will solve first three sub-parts for you. If…

Q: stock has an expected return of 12.1 percent and a beta of 1.17, and the expected return on the…

A: Capital asset pricing model (capm) describe the relationship between systematic risk and return of…

Q: Cooley Computer Repair and Service Company's stock has a beta of 1.28, the risk-free rate is 2.25%,…

A: According to capm approach required return is equal to risk free rate plus beta times market risk…

Q: Stock A has a beta of 0.7, whereas Stock B has a beta of 1.3. Portfolio P has 50% invested in both A…

A: According to CAPM: required return = risk free rate+beta×market risk premium

Q: Stock A has a beta of 0.87 and an expected return of 9.21 percent. Stock B has a beta of 1.36 and an…

A: Expected return as per CAPM = Risk free rate + Beta * Market risk premium

Q: The beta coefficient for Stock C is βc = 0.4 and that for Stock D is βd = -0.5 (Stock D’s beta is…

A: Beta of C (Bc) = 0.4 Beta of D (Bd) = -0.5 Risk free rate = 9% Market return = 13%

Q: Fiske Roofing Supplies' stock has a beta of 1.23, its required return is 9.50%, and the risk-free…

A: Stock beta is 1.23 Required return is 9.50% risk free rate is 4.30%   To Find: Required rate of…

Q: From the following information calculate Beta for stock A, required return of stock A as per CAPM…

A: In this we have to calculate the Beta of stock and from that get required rate.

Q: The following information describes the expected return and risk relationship for the stocks of two…

A: a.

Q: Stock A has a beta of 1.2 and Stock B has a beta of 1. The returns of Stock A are ______ sensitive…

A: Beta is sensitivity of a stock with respect to changes in market return. Beta of Stock A is 1.2 Beta…

Q: What is the required return on a stock with a beta of -0.20 given a risk-free rate of 2.75% and an…

A: Stock investments are the investments that are made by investors in the stocks of a corporation,…

Q: Kaskin, Inc., stock has a beta of 1.2 and Quinn, Inc., stock has a beta of .6. Which of the…

A: According to CAPM, the expected rate f return is the sum of the risk free rate and the risk premium…

Q: Stock Y has a beta of 1.2 and an expected return of 11.5 percent. Stock Z has a beta of .80 and an…

A: Since you have asked multiple questions, we will solve the first question for you. If you want any…

Q: a) The covariance between stocks A and B is 0.0014, standard deviation of stock A is 0.032, and…

A: “Since you have asked multiple questions, we will solve the first question for you. If you want any…

Q: Required Rate of Return Stock R has a beta of 1.8, Stock S has a beta of 0.35, the expected rate of…

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

Q: An individual common stock has a beta of 0.9 and a correlation coefficient of 0.9. The expected…

A:

Q: Stock A is fairly priced by the market. Given that the risk free rate is 3.5%, the beta of stock A…

A: The CAPM (capital assets pricing model) is a tool that help to compute the expected return on the…

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: he risk-free rate is 4.2 percent and the expected return on the market is 12.3 percent. Stock A has…

A: If expected return is more than required return then security is undervalued. If required return is…

Q: Stock A has expected return of 15% and standard deviation (s.d.) 20%.  Stock  B  has  expected…

A: The Capital Asset Pricing Model establishes a relationship between systematic risk and expected…

Q: The risk-free rate is 2.58% and the market risk premium is 4.31%. A stock with a β of 1.22 will have…

A: Introduction: The term expected return refers to the anticipated loss or gain by an investor from…

Q: Stock X has a beta of 0.8 and Stock Y has a beta of 1.2. 50% of Portfolio P is invested in Stock X…

A: Answer -  Formula for CAPM i- Rf+beta*risk premium, If there is any increase in premium, it will be…

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: stock has a beta of 1.14, the expected return on the market is 10.8 percent, and the risk-free rate…

A: Beta=1.14 Return is market =10.8% Risk free rate =4.55%

Q: Stock A's stock has a beta of 1.25, and its required return is 12.00%.  Stock B's beta is 0.90.  If…

A: Given Information Stock A's  Beta = 1.25 Required return = 12% Stock B's  Beta = 0.90 Risk free rate…

Q: Stocks X and Y have the following probability distributions of expected future returns: Calculate…

A: Here, Probability X Y 0.3 90% -35% 0.4 15% 0 0.3 -60% 20 Expected rate of Return of X…

Q: Stock alpha has a market beta is 1.2, and the total volatility of its stock returns is 60%. Stock…

A: Based on CAPM, Expected return = risk free rate + beta*market risk premium

Q: Fiske Roofing Supplies' stock has a beta of 1.23, its required return is 9.00%, and the risk-free…

A: Beta: It refers to the risk that can not be eliminated. This is the risk that affects the entire…

Q: Stock R has a beta of 1.5, Stock S has a beta of 0.85, the required return on an average stock is…

A: Given, beta(stock R)=1.5 beta(stock S)=0.85 Average stock=9% Rate of return=3%

Q: Dotbomb’s stock has the following projected rates of return (outcomes): 10%, 15%, and 30%. The…

A: Portfolio Expected Return:  It is the sum weighted average rate of return of each security consist…

Q: A stock has a beta of 1.2, the expected return on the market is 9 percent, and the risk-free rate is…

A: We need to use CAPM to calculate expected return Expected return =Risk free rate +Beta(Market return…

Q: Stock A's stock has a beta of 1.30, and its required return is 13.75%. Stock B's beta is 0.80. If…

A: Stock A beta = 1.30 Required return = 13.75% Risk free rate = 2.75%   As per formula…

Q: What is the expected return for Stock A if it has a beta of 1.25, the risk-free rate is 1.5%, and…

A: Given, Beta = 1.25 Risk-free rate = 1.5% Expected market return = 10.2%

Q: Stock A is fairly priced by the market. Given that the risk free rate is 3.5%, the beta of stock A…

A: Capital Asset Pricing Model (CAPM) method is used for finding the expected return of the…

Q: Stock A's stock has a beta of 1.30, and its required return is 15.75%. Stock B's beta is 0.80. If…

A: Given information: Stock A beta is 1.30 Required return is 15.75% Stock B beta is 0.80 Risk free…

Q: A stock has a beta of 1.13, the expected return on the market is 10.7 percent, and the risk-free…

A: Beta (B) = 1.13 Market return (MR) = 10.7% Risk free rate (RF) = 4.6%

Q: Required Rate of Return Stock R has a beta of 1.4, Stock S has a beta of 0.45, the expected rate of…

A: Beta is one of the measure of volatility or risk of the stock. More beta means more risk and less…

Q: A stock has an expected return of 10.2%, the risk-free rate is 4.1% and the market risk premium is…

A: CAPM is a model which is used to calculate expected rate of return from the stock. It expresses…