What is the expected return for a company with a beta of 0.5, while treasury bills...

What is the expected return for a company with a beta of 0.5, while treasury bills are yielding 3% and the return on the market portfolio is 10%?

a. 5.50%

b. 6.50%

c. 17.00%

d. 3.00%

e. 8.00%

Expert Solution

Expected return=risk free rate+beta*(market rate-risk free rate)

=3+0.5*(10-3)

which is equal to

=6.5%

jeff jeffy answered 2 years ago

What is the beta for a company with a 12% expected return, while treasury bills are...

What is the beta for a company with a 12% expected return, while treasury bills are yielding 5% and the market risk premium is 7%? a. 0.5 b. 1.0 c. 0.75 d. 1.5 e. 1.25

A stock has a beta of 0.5 and an expected return of 9.6 percent. A risk-free...

A stock has a beta of 0.5 and an expected return of 9.6 percent. A risk-free asset currently earns 3.3 percent. If a portfolio of the two assets has an expected return of 12 percent, what is its beta? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

Stock J has a beta of 1.5 and an expected return of 15%, while Stock K has a beta of .75 and an expected return of 9%.

Stock J has a beta of 1.5 and an expected return of 15%, while Stock K has a beta of .75 and an expected return of 9%. You want a portfolio with the same risk as the market. What is the expected return of your portfolio?Group of answer choices10 percent11 percent12 percent13 percent14 percent

Company A has a beta of 0.70, while Company B's beta is 1.10. The required return...

Company A has a beta of 0.70, while Company B's beta is 1.10. The required return on the stock market is 11.00%, and the risk-free rate is 4.25%. What is the difference between A's and B's required rates of return? (Hint: First find the market risk premium, then find the required returns on the stocks.) Select the correct answer. a. 2.50% b. 2.55% c. 2.60% d. 2.65% e. 2.70%

Company A has a beta of 0.70, while Company B's beta is 1.15. The required return...

Company A has a beta of 0.70, while Company B's beta is 1.15. The required return on the stock market is 11.00%, and the risk-free rate is 4.25%. What is the difference between A's and B's required rates of return? (Hint: First find the market risk premium, then find the required returns on the stocks.)

What is the risk premium for a stock that has a Beta of 2.5, while treasury...

What is the risk premium for a stock that has a Beta of 2.5, while treasury bills are yielding 1% and the return on the market portfolio is 11%?

Company X has a beta of 0.70, while Company Y's beta is 1.20. The required return...

Company X has a beta of 0.70, while Company Y's beta is 1.20. The required return on the stock market is 11.00%, and the risk-free rate is 4.25%. A fund has $3500 invested in company X stock and $4500 invested in the stock of company Y. a) What is fund's required rate of return? b) Suppose you sell all of your holdings in stock Y and invest $4500 in stock Z having beta of 1.5. What is the fund's new...

THY stock has an expected return of 19 percent with a beta of 1.7, while Pegasus...

THY stock has an expected return of 19 percent with a beta of 1.7, while Pegasus stock has an expected return of 14 percent with a beta of 1.2. Assume the CAPM is true. What is the expected return on the market? What is the risk-free rate? Note: beta of the market is one, CAPM is defined with security market line.

Stock J has a beta of 1.35 and an expected return of 13.91 percent, while Stock...

Stock J has a beta of 1.35 and an expected return of 13.91 percent, while Stock K has a beta of .90 and an expected return of 10.85 percent. You want a portfolio with the same risk as the market. What is the portfolio weight of each stock? (Do not round intermediate calculations and round your answers to 4 decimal places, e.g., 32.1616.) Stock J Stock K What is the expected return of your portfolio? (Do not round...

The expected rate of return on a Treasury Bill is 0.020, the expected rate of return...

The expected rate of return on a Treasury Bill is 0.020, the expected rate of return on the Bud 5000 is 0.08 and the required rate of return of a stock is 0.10. What is the stocks beta?

Question