the required rate of Enterprises assuming that inv ors expect a 3. riation in the ture. The real risk-free rate is 2.0%, and the market risk premium is 6.5%. Mudd has a beta of 2.0, and its realized r turn has averaged 11.5% over the past 5 years. Round your answer to two decimal places.

the required rate of Enterprises assuming that inv ors expect a 3. riation in the ture. The real risk-free rate is 2.0%, and the market risk premium is 6.5%. Mudd has a beta of 2.0, and its realized r turn has averaged 11.5% over the past 5 years. Round your answer to two decimal places.

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter8: Analysis Of Risk And Return

Section: Chapter Questions

Problem 14P

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Question

Calculate the required rate of return for Mudd Enterprises assuming that investors expect a 3.7% rate of inflation in the
future. The real risk-free rate is 2.0%, and the market risk premium is 6.5%. Mudd has a beta of 2.0, and its realized rate of
return has averaged 11.5% over the past 5 years. Round your answer to two decimal places.
%

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