A stock has a beta of 1.32, the expected return on the market is 10 percent, and the risk-free rate is 3.5 percent. What must the expected return on this stock be? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
Q: A stock has a required return of 10%, the risk-free rate is 6%, and the market risk premium is 3%.…
A: Formula: Required return=Risk free rate+Beta×Risk premium
Q: Suppose Autodesk stock has a beta of 2.20, whereas Costco stock has a beta of 0.72. If the risk-free…
A: Portfolio Return is that under which investor will invest his money in more than one stock of the…
Q: stock has a required return of 8%, the risk-free rate is 3.5%, and the market risk premium is 3%. a.…
A: CAPM is an abbreviation used for Capital asset pricing model. This model is used to determine the…
Q: Stock R has a beta of 1.5, Stock S has a beta of 0.95, the required return on an average stock is…
A: Required rate of return is defined as the minimum return regarding an investor, which is used to…
Q: expected
A: Introduction: Capital asset pricing model or CAPM as it is known widely is a tool which helps in…
Q: A stock has a required return of 13%, the risk-free rate is 4.5%, and the market risk premium is 4%.…
A: In order to calculate the stock's beta, we can use the the formula given under capital asset pricing…
Q: A stock has a beta of 1.07, the expected return on the market is 10.1 percent, and the risk- free…
A: Beta = 1.07 Market return = 10.1% Risk free rate = 4.9%
Q: A stock has a beta of 1.15, the expected return on the market is 11.0%, and the risk-free rate is…
A: Under CAPM, the market variants that could affect the stock price are taken into consideration. It…
Q: The risk-free rate of return is currently 0.02, whereas the market risk premium is 0.05. If the beta…
A: Given information: Risk free rate of return is 0.02 Market risk premium is 0.05 Beta value of stock…
Q: A stock has a beta of 1.12, the expected return on the market is 10 percent, and the free rate is 3…
A: In this we have to use capital assets pricing formula for calculation of expected return.
Q: Suppose the market risk premium is 9 % and also that the standard deviation of returns on the market…
A: Expected rate of return is the minimum return that a shareholder requires on the investment made in…
Q: Presently, the risk-free rate is 4 percent (Rf )and the expected return on the market portfolio…
A: required return = risk free rate + beta*market risk premium GM required return = 4% + 1.2*(9 - 4)% =…
Q: A stock has an expected return of 15.6 percent, the risk-free rate is 6.2 percent, and the market…
A: The beta of the stock can be calculated with the help of CAPM equation.
Q: A stock has a required return of 16%, the risk-free rate is 4%, and the market risk premium is 6%.…
A: a) As per CAPM, required rate of return = risk free rate + (beta * market risk premium)
Q: Assume the expected return on the market is 7 percent and the risk-free rate is 4 percent. a. What…
A: In the given question we have two parts: In Part (A) we need to compute expected return for a stock…
Q: Stocks A and B have the following probability distributions of expected future returns:…
A: 1.) Computation of the expected rate of return of stock A: Hence, the expected return of stock A is…
Q: A stock has an expected return of 14.1 percent, a beta of 1.8, and the return on the market is 9.8…
A: Expected return (Re) = 14.1% Beta (B) = 1.8 Market return (Rm) = 9.8% Risk free rate = Rf
Q: A stock has a beta of 1.1, the expected return on the market is 10.4 percent, and the risk-free rate…
A: Expected return = Risk free rate+Beta*(Market return-Risk free rate) Where Risk free rate = 4.75%…
Q: A stock has a beta of 1.55, the expected return on the market is 8%, and the risk-free rate is 15%.…
A: In the given question we are require to calculate the Expected return We can calculate the expected…
Q: A stock has an expected return of 12.4 percent, the risk-free rate is 6.5 percent, and the market…
A: According to CAPM : beta of stock = ( expected return - risk free rate)/market risk premium
Q: A stock has an expected return of 13.2 percent, the risk-free rate is 3.5 percent, and the market…
A: According to capital asset pricing model: rs=rf+beta×rm-rfwhere,rs=expected returnrm-rf=market risk…
Q: A stock has an expected return of 16.4%, its beta is 1.3, and the expected return on the market is…
A: Following details are given to us in the question: Expected return of stock = 16.4% Beta = 1.3…
Q: A stock has a beta of 0.65, the expected return on the market is 15%, and the risk- free rate is 8%.…
A: In the given problem we require to calculate the expected return on stock: According to CAPM i.e.…
Q: A stock has a beta of 1.68, the expected return on the market is 14.72, and the risk-free rate is…
A: As per CAPM formula Expected return on stock = Risk free return + Beta*(Market return-Risk free…
Q: A stock has an expected return of 9.9 percent, the risk-free rate is 1.8 percent, and the market…
A: Expected return = 9.9% Risk free rate = 1.8% Market risk premium = 4.3%
Q: Jerilu Markets has a beta of 1.05. The risk-free rate of return is 2.64 percent and the market rate…
A: Introduction:- Risk premium is the excess return over the guaranteed rate of return. It is more…
Q: A stock has an expected return of 14 percent, the risk-free rate is 6 percent, and the market risk…
A: The beta of the stock can be calculated as per CAPM
Q: A stock has an expected return of 13.6 percent, the risk-free rate is 3.7 percent, and the market…
A: In the above question we require to compute the expected beta of the stock. This question can be…
Q: Stock R has a beta of 1.5, Stock S has a beta of 0.75, the expected rate ofreturn on an average…
A: The riskiness of security is measured by "Beta". Beta measures the volatility of the stock with…
Q: Assume the expected return on the market is 18 percent and the risk-free rate is 4 percent.…
A: Expected return means the percentage of profit that investor is expected depending upon the risk…
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: Stock J has a beta of 1.28 and an expected return of 13.56 percent, while Stock K has a beta of .83…
A: Market beta is 1. Beta of Stock J = 1.28 Beta of Stock K = 0.83 Let Weight of Stock J = WJ Let…
Q: A stock has an expected return of 11.25 percent, a beta of 0.82, and the expected return on the…
A: Capital asset pricing model is used to compute the expected return from a stock: Here, Expected…
Q: Stock R has a beta of 1.7, Stock S has a beta of 0.8, the required return on an average stock is…
A: The question is based on the concept of the capital asset pricing model (CAPM). CAPM explains the…
Q: Assume the expected return on the market is 9 percent and the risk-free rate is 4 percent. What is…
A: CAPM Model: Expected return on Stock = Risk free Rate + Beta x ( Market risk Premium) Market risk…
Q: JaiLai Cos. stock has a beta of 0.6, the current risk-free rate is 6.0 percent, and the expected…
A: The following information has ben provided in the question: Beta =0.6 Risk free rate =6% Expected…
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: Assume that the risk-free rate is 2.5% and the market risk premium is 8%. What is the required…
A: Risk Free Rate = 2.5% Market Risk Premium = 8%
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: A stock has a beta of 1.4 and an expected return of 12.7 percent. If the risk-free rate is 4.9…
A: Following details are given to us in the question : Beta = 1.4 Expected Return (ER) = 12.7% Risk…
Q: Stock R has a beta of 1.5, Stock S has a beta of 0.75, the expected rate of return on an average…
A: In this we have to calculate expected return of both stock using CAPM model and find the difference.
Q: A stock has a beta of 1.08, the expected return on the market is 10.2 percent, and the risk-free…
A: Expected return on the market (Rm) = 0.102 beta (b) = 1.08 Risk free rate (Rf) = 0.0485 Expected…
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: A stock has a beta of 1.04, the expected return on the market is 11.75, and the risk-free rate is…
A: A stock is a financial security issued by companies to raise equity funds from the primary market.…
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 a beta of 1.14, the expected return on the market is 10.8 percent, and the risk- free…
A: The expected return of the stock can be calculated with the help of CAPM equation
Q: a. A stock has a beta of 1.2, the expected return on the market is 17 percent, and the risk-free…
A: Following details are given to us: Beta = 1.2 Expected return on Market = 17% Risk free rate= 8% We…
17
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
- A stock has an expected return of 11.85 percent, its beta is 1.08, and the risk-free rate is 3.9 percent. What must the expected return on the market be? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Market expected return %A stock has an expected return of 16.5 percent, its beta is 1.50, and the risk-free rate is 4.5 percent. What must the expected return on the market be? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Market expected return %A stock has an expected return of 18.0 percent, a beta of 1.90, and the return on the market is 11.60 percent. What must the risk-free rate be? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) Risk-free rate
- A stock has an expected return of 17 percent, its beta is 1.35, and the risk-free rate is 4 percent. What must the expected return on the market be? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)A certain stock has a beta of 1.2. If the risk-free rate of return is 4.5 percent and the market risk premium is 8 percent, what is the expected return of the stock? What is the expected return of a stock with a beta of 1.08? (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.) Beta of 1.2 expected return % Beta of 1.08 expected return %A stock has a beta of 1.06, the expected return on the market is 10 percent, and the risk- free rate is 4.95 percent. What must the expected return on this stock be? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Expected return Help % Save & Exit
- A stock has an expected return of 12.7 percent, its beta is 1.80, and the risk-free rate is 3.2 percent. What must the expected return on the market be? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.)A stock has a beta of 1.14, the expected return on the market is 10.8 percent, and the risk- free rate is 4.55 percent. What must the expected return on this stock be? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Expected return %A stock has a beta of 1.10, the expected return on the market is 12 percent, and the risk-free rate is 3.6 percent. What must the expected return on this stock be? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Expected return %
- A stock has a beta of 0.8 and an expected return of 10.6 percent. If the risk-free rate is 2.7 percent, what is the market risk premium? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) Market risk premiumA stock has a beta of 1.2, the expected return on the market is 9 percent, and the risk-free rate is 1.5 percent. What must the expected return on this stock be? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Please format answer in a percentage as "X.XX"A stock has an expected return of 0.15, its beta is 0.52, and the expected return on the market is 0.08. What must the risk-free rate be? (Hint: Use CAPM) Enter the answer in 4 decimals e.g. 0.0123.