Question

In: Finance

A given firm has a beta value of 1.3, the risk-free rate is 3% and the...

A given firm has a beta value of 1.3, the risk-free rate is 3% and the market risk premium is 5.5%. What is the required return for this stock?

Select one:

9.55%

10.15%

11.05%

5.25%

6.25%

Solutions

Expert Solution

Required rate = Risk free rate + beta(market risk premium)

Required rate = 3% + 1.3(5.5%)

Required rate = 3% + 7.15%

Required rate = 10.15%

jeff jeffy answered 2 years ago
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