Suppose Walmart stock has a beta of 0.63. If the market return is 12%, the risk free rate is 2%, and the r-squared is 0.88. What is the expected rate of return for Walmart stock? Question 19 options: 8.30% 7.56%
Q: Your parents will retire in 20 years and currently have $108,000 saved in a retirement account. They…
A: Data given: PV=$108,000 n=20 years FV=$700000 Required: Compute annual interest rate
Q: QUESTION 1 The minimum downside projection from a head and shoulders top pattern is derived A.…
A: The answer to the question are given below :
Q: The final coupon payment and par value are paid to the bond holder on the maturity date. Select…
A: Par value of bond is that amount which is also called face value of the bond. it is received by the…
Q: A government bond with 2 years until maturity has a face value of £120,000 and an annual nominal…
A: This post has three questions. The first has been answered below.
Q: Questions asked in the personal interview 1. Why were you selected out of all the…
A: Introduction: I am honored and humbled to have been selected out of all the applicants for the role…
Q: Bloome Co.'s stock has a 25% chance of producing a 30% return, a 50% chance of producing a 12%…
A: Expected Return will be calculated using formula : Expected return = Probability ×…
Q: Consider the following investments : (1) $1,000 invested at 10% per annum with monthly compounding.…
A: Here we will calculate Future value of all the investments separately and whichever will give…
Q: By calling the additional dividend an extra dividend, a firm avoids setting expectations that the…
A: An additional dividend is an extra dividend payment that a company may make to its shareholders,…
Q: Computech Corporation is expanding rapidly and currently needs to retain all of its earnings: hence,…
A: Dividend in year 1 = d1 = $0.75 Dividend in year 2 = d2 = $0.75 Dividend in year 3 = d3 = $0.75…
Q: You find a bond with 28 years until maturity that has a coupon rate of 7 percent and a yield to…
A: A bond indicates a debt instrument that obligates its issuer to repay the par value along with a…
Q: Calculate the finance charge (in $), the finance charge per $100 (in $), and the annual percentage…
A: Amount Financed = $14,000 Number of payment = 36 Monthly payment = $503
Q: Dakota takes a car to a title loan business to borrow some money. Dakota is giving $900. He must pay…
A: When the lender lends a loan to the borrower, he charges a rate of interest on the borrowed amount.…
Q: New windows are expected to save $950 per year in energy costs over their 30-year life for Fab…
A: IRR stands for "Internal Rate of Return." It is a financial metric used to estimate the…
Q: If you purchased a newly issued 10-year bond from the Icelandic government with a face value of…
A: Bonds are debt instruments issued by different entities. The issuing entity can be a government…
Q: FedEx Corp. stock ended the previous year at $103.39 per share. It paid a $0.35 per share dividend…
A: Beginning value per share = $103.39 Dividend per share = $0.35 Ending value per share = $106.69…
Q: Consider a company that is projected to generate revenues of $104 million next year. Analysts expect…
A: Free cash flow is an important metric for investors because it provides insight into a company's…
Q: McGilla Golf has decided to sell a new line of golf clubs. The clubs will sell for $920 per set and…
A: Capital budgeting techniques are used to evaluate potential long-term investments in projects or…
Q: A 23-year bond with a coupon rate of 4.4% has a yield of 7.6%. The bond pays coupons semi-annually.…
A: All the characteristics of a bond have been provided. It's price has to be determined. The price of…
Q: What current rate environment is the US currently in by historical standards? (LOW, HIGH, AVERAGE)…
A: Note: Since you have posted a question with multiple sub-parts, we will provide the solution only to…
Q: BANK ABC purchased a corporate bond with a coupon rate of 5.5% and a face value of $1000. It has 11…
A: The holding period yield (HPY) of a bond is the total return earned by an investor from holding the…
Q: Suppose that in January 2021, the Coca-Cola Company (KO) had sales of $518 million, EBITDA of $55.6…
A: Sales = $518 million EBITDA = $55.6 million Excess of cash = $100 million Interest bearing debt = $3…
Q: DFB, Inc. expects earnings next year of $5.63 per share, and it plans to pay a $4.11 dividend to…
A: The dividend expected next year the growth rate and cost of equity is considered to calculate the…
Q: Barton Industries expects next year's annual dividend, D1, to be $2.00 and it expects dividends to…
A: When a company comes up with a new issue of securities, it incurs costs like underwriting, legal…
Q: lected ratios formulars Unilever 2021 BOPP 2021 ROCE PBIT / net assets * 100 (32,424/39,406…
A: A part of the report explaining the interpretation of various ratios which are helpful in comparing…
Q: An investor enters into a 2-year swap agreement to swap euros at $1.32 per euro. Soon after the swap…
A: Swap is a derivative contract between two parties who agree to exchange financial instruments or…
Q: A savings account balance is compounded annually. If the interest rate is 3% per year and the…
A: Interest is being accumulated in the account under compound interest. The balance in the account…
Q: Suppose Goodyear Tire and Rubber Company is considering divesting one of its manufacturing plants.…
A:
Q: (Related to Checkpoint 9.1) (Floating-rate loans) The Bensington Glass Company entered into a loan…
A: It is a case of a floating interest rate being charged to the loan amount. It means that interest…
Q: A house costs $1 OA. 6.7% OB. 9.7% O C. 7.7% O D. 8.7%
A: Given information: Cost of house is $141,000 Monthly payment is $1,763.32 Number of years is 10 and…
Q: Miguel purchased a hot tub costing $5,030 by taking out an installment loan. He made a down payment…
A: Loans are paid back in fixed periodic payments. The amount of the periodic payments depends on the…
Q: Answer ALL parts of this question. The data below describes a three-stock financial market that…
A: Stock market refers to a market where the trading of stock between buyers and sellers has been…
Q: (they ned to last longen. Pappy's paid $2 Pappy up with a new product, the marketing survey to…
A: Capital budgeting tools are used to determine the financial feasibility and viability of a project.…
Q: The management of Stillford Micro Brew is considering the purchase of an automated bottling machine…
A: In a typical capital budgeting replacement project, the simple rate of return is required. For the…
Q: Give typing answer with explanation and conclusion A promissory note for $7200.00 dated May 15,…
A: Principal value = $7200.00 Compound interest = $740.00 Compound Interest rate = 9.6% compounded…
Q: has a total 1₂
A: So it can be mentioned as Bp = Wa*Ba + Wb*Bb Where Bp is the portfolio Beta, and Wa is the weight…
Q: Binomial Tree Farm’s financing includes $5 million of bank loans and $6 million book (face) value of…
A: Debt and equities are two different sources to raise capital for companies. Debt can be raised using…
Q: Suppose that today’s date is April 15. A bond with a 8% coupon paid semiannually every January 15…
A: The invoice price of the bond needs to be determined, in between the coupon dates. The invoice price…
Q: Andrea, a self-employed individual, wishes to accumulate a retirement fund of $250,000. How much…
A: Use the formula for present value of an annuity to calculate the monthly deposit required: PV = PMT…
Q: On January 1, Veltron International has inventory worth $599,900 at cost. At the end of the year,…
A: Inventory turnover is the number of times inventory is sold and replaced during the year. It…
Q: Andouille Spices, Incorporated, has the following mutually exclusive projects available. The company…
A: To choose the best option or proposal, capital budgeting entails long-term planning, monitoring…
Q: Describe in your own words the characteristics of growth and value stocks. Which type of stock is…
A: Stocks, usually referred to as shares or equities, are certificates of ownership in publicly traded…
Q: Personal loans Payday loans Student loans [Choose ] [Choose ] are offered to college students and…
A: Personal loans - Personal Loan is an amount of money that anyone can borrow and it is used for a…
Q: In 2020, Caterpillar Incorporated had about 540 million shares outstanding. Their book value was…
A: Number of shares outstanding = 540 million Book value of equity per share = $25.36 Market value of…
Q: operating cash flows of a project: includes tax. none of the others is correct are equal…
A: Operating cash flow are cash flow related to normal operations of Business. so these are the cash…
Q: Bob has a credit card with an APR of 25%. He paid off all but $434 in May. Bob's billing period runs…
A: Calculation of credit card balance on following dates: Date Opening Balance Charge Payment…
Q: Mr. Nel, an entrepreneur who is currently 55 years old, took early retirement from his business…
A: Return represents the reward for making an investment. Risk refers to the variability in returns.…
Q: (Common stock valuation) The common stock of NCP paid $1.35 in dividends last year. Dividends are…
A: Dividend - This is the amount which is paid by the company to its shareholders. Dividend includes…
Q: Give the beliefs (bullet style) and business relations of different religions and philosopy to…
A: Business ethics is a field of study that examines ethical principles and moral or ethical problems…
Q: Vani Corporation's beta coefficient is equal to 0.7 and the required rate of return on the stock…
A: CAPM is used to determine expected return by an investor considering systematic risk and risk-free…
Q: Oppenheimer Bank is offering a 30-year mortgage with an EAR of 6.625%. If you plan to borrow…
A:
Suppose Walmart stock has a beta of 0.63. If the market return is 12%, the risk free rate is 2%, and the r-squared is 0.88. What is the expected
Question 19 options:
|
8.30% |
|
7.56% |
Step by step
Solved in 3 steps
- Stock A's stock has a beta of 1.30, and its required return is 10.25%. Stock B's beta is 0.80. If the risk-free rate is 4.75%, what is the required rate of return on B's stock? (Hint: First find the market risk premium.) Select the correct answer. a. 8.07% b. 8.19% c. 8.13% d. 8.25% e. 8.31%Stock A's stock has a beta of 1.30, and its required return is 12.00%. Stock B's beta is 0.80. If the risk-free rate is 4.75%, what is the required rate of return on B's stock? (Hint: First find the market risk premium.) a. 8.76% b. 8.98% c. 9.21% d. 9.44% e. 9.68%Question: A stock has an expected return of 9.7 percent, its beta is .89, and the risk-free rate is 2.9 percent. What must the expected return on the market be?
- If the risk-free rate is 3%, the market risk premium is 9%, and the beta of a given stock is 1.03. If you buy this stock and earn a subsequent return of 15%, what alpha have you earned? Question 23 options: 2.73% 6%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 the risk-free rate is 4.00%, what is the required rate of return on B's stock? (hint: first find out market risk premium, then apply to find stock B's required rate of return) 8.12% 10.25% 9.12% 9.76% 8.76%Suppose the expected return on the market is 10 percent and the risk-free rate is 5 percent. Solomon Inc. stock has a beta of 1.4. What is the expected return on the Solomon stock? Question 9 options: A) 12.8% B) 19.3% C) 12.0% D) 7.8%
- The risk-free rate of return is 4.24 percent and the market risk premium is 9.5 percent. What is the expected rate of return on a stock with a beta of 1.36? Question 7 options: 17.16% 11.39% 12.92% 11.03% 15.27%Which one of the following stocks is correctly priced if the risk-free rate of return is 3.0 percent and the market risk premium is 7.5 percent? Expected Return 8.46% Stock A B с D E 0000С Stock A O Stock D Stock C O Stock E Beta 77 1.46 1.27 1.44 .95 Stock B 12.47 11.19 13.80 8.65Stock A has a beta of 1.2, and its required rate of return is 11.00%. Stock B's beta is 0.80. If the risk-free rate is 4.50%, what is the required rate of return on Stock B? (Ch. 8) Group of answer choices 9.45% 7.07% 8.39% 8.83% 7.95%
- which one is correct? QUESTION 8 Exhibit 7.2 USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S) You expect the risk-free rate (RFR) to be 3 percent and the market return to be 8 percent. You also have the following information about three stocks. Current Expected Expected Stock Beta Price Price Dividend X 1.25 $20 $23 $1.25 Y 1.50 $27 $29 $0.25 Z 0.90 $35 $38 $1.00 Refer to Exhibit 7.2. What are the expected (required) rates of return for the three stocks (in the order X, Y, Z)? a. 21.25 percent, 8.33 percent, 11.43 percent b. 16.50 percent, 5.50 percent, 22.00 percent c. 15.00 percent, 3.50 percent, 7.30 percent d. 6.20 percent, 2.20 percent, 8.20 percent e. 9.25 percent, 10.5 percent, 7.5 percentFind the Beta for Stock Y given the Expected Return of Stock Y is 18.4% The expected return on the Market Portfolio is 28.4% and Risk-Free Rate is 4.5 %. Select one: O a. 0.60 O b. 0.90 O c None O d. 0.56 O e. 0.80Find the Risk-Free Rate given the Expected Return on Stock Y is 20 %, the Expected Return on Market Portfolio is 24 % and Beta for Stock Y is 0.8. Select one: O a. 5% O b. None O c. 6% O d. 4% O e. 7%