In: Finance

Q13) The market risk premium for next period is 8.74% and the risk-free rate is 3.79% . Stock Z has a beta of 0.789 and an expected return of 10.03%. Compute the following:

a) Market's reward-to-risk ratio :

b) Stock Z's reward-to-risk ratio :

a). What is the market risk premium if the risk free rate is 5%
and the expected market return is given as follows?
State of nature
Probability
Return
Boom
20%
30%
Average
70%
15%
Recession
10%
5%
b). A firm is evaluating two projects that are mutually
exclusive with initial investments and cash flows as follows:
Project A
Project B
Initial Investment
End-of-Year Cash Flows
Initial Investment
End-of-Year Cash Flows
RM40,000
RM 20,000
RM 90,000
RM 40,000
RM 20,000
RM...

If the market risk premium is 2%, the risk-free rate is 4.4% and
the beta of a stock is 1.2, what is the expected return of the
stock?

The risk-free rate is 1.27% and the market risk premium is
7.65%. A stock with a β of 1.34 just paid a dividend of $1.29. The
dividend is expected to grow at 20.50% for three years and then
grow at 4.96% forever. What is the value of the stock?
The risk-free rate is 1.13% and the market risk premium is
9.58%. A stock with a β of 1.16 just paid a dividend of $1.86. The
dividend is expected to grow...

The risk-free rate is 1.86% and the market risk premium is
7.72%. A stock with a β of 1.74 just paid a dividend of $2.78. The
dividend is expected to grow at 22.07% for five years and then grow
at 4.02% forever. What is the value of the stock?
Answer format: Currency: Round to: 2
decimal places.

The risk-free rate is 2.37% and the market risk premium is
6.39%. A stock with a β of 1.60 just paid a dividend of $2.67. The
dividend is expected to grow at 21.99% for three years and then
grow at 3.53% forever. What is the value of the stock?
The answer is $48.21 but not sure how to get that answer. Please
show the finance calculator steps if possible and not excel!
Thanks

EXPECTED AND REQUIRED RATES OF RETURN
Assume that the risk-free rate is 6% and the market risk premium is 3%.
What is the required return for the overall stock market? Round your answer to two decimal places. %
What is the required rate of return on a stock with a beta of 0.8? Round your answer to two decimal places.

1. The risk free rate is 2%, the risk premium for the market is
5%, and a stock has an expected return of 10.5%. What is the firm’s
beta?
2. A firm has a beta of 1.3 and the risk premium for the market
is 6%. If the firms expected return is 11%, what is the risk free
rate?
3. A firm with a beta of 1.5 has a market return of 15% when the
risk free rate is 3%...

The risk-free rate is 1.25% and the market risk premium is
5.78%. A stock with a β of 0.84 just paid a dividend of $2.17. The
dividend is expected to grow at 20.45% for three years and then
grow at 4.90% forever. What is the value of the stock?
Submit
Answer format: Currency: Round to: 2
decimal places.
unanswered
not_submitted
Attempts Remaining: Infinity
#2
The risk-free rate is 1.04% and the market risk premium is
8.82%. A stock with a...

The risk-free rate is 2.43% and the market risk premium is
8.12%. A stock with a β of 1.56 just paid a dividend of $1.36. The
dividend is expected to grow at 23.91% for five years and then grow
at 3.26% forever. What is the value of the stock?
Answer format: Currency: Round to: 2 decimal places.

The risk-free rate is 2.89% and the market risk premium is
7.59%. A stock with a β of 1.59 just paid a dividend of $2.55. The
dividend is expected to grow at 23.34% for five years and then grow
at 3.79% forever. What is the value of the stock?

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