Question

In: Finance

Assume that the risk-free rate is 3% and the required return on the market is 9%....

Assume that the risk-free rate is 3% and the required return on the market is 9%. What is the required rate of return on a stock with a beta of 2.2? Round your answer to two decimal places.

Solutions

Expert Solution


Related Solutions

Assume that the risk-free rate is 6% and the required return onthe market is 9%....
Assume that the risk-free rate is 6% and the required return on the market is 9%. What is the required rate of return on a stock with a beta of 0.6? Round your answer to two decimal places.
Assume that the risk-free rate of return (Krf) is 3% and the required rate of return...
Assume that the risk-free rate of return (Krf) is 3% and the required rate of return on the market (Km) is 8%. A given stock, say, Caterpillar (CAT) has a beta coefficient of 1.03. If the dividend per share during the coming year, meaning D1, is $4.12 and g = 3.50%, what is the current intrinsic value of the stock? Exactly how much was D0? How long will it take for the dividend to double, given the growth rate, approximately?...
Assume that the risk-free rate is 2.5% and the required return on the market is 10%....
Assume that the risk-free rate is 2.5% and the required return on the market is 10%. What is the required rate of return on a stock with a beta of 2.1? Round your answer to two decimal places.
Assume that the risk-free rate is 4.5% and the required return on the market is 8%....
Assume that the risk-free rate is 4.5% and the required return on the market is 8%. What is the required rate of return on a stock with a beta of 2? Round your answer to two decimal places.
Risk free rate of return is 5% & required rate of return on the market is...
Risk free rate of return is 5% & required rate of return on the market is 9%. What is the security market line? If corporate beta is 1.8 what does that mean?
Assume that the risk-free rate is 3% and the expected return on the market is 8.5%....
Assume that the risk-free rate is 3% and the expected return on the market is 8.5%. What is the required rate of return on a stock with a beta of 1.3? a. 10.15% b. 14.05% c. 11.05% d. 7.15%
If the risk free rate of return is 7%, the required return on the market is...
If the risk free rate of return is 7%, the required return on the market is 10%, and the required rate of return on Stock J is 13%, what is Stock J’s beta coefficient? a. 1.0 b. 1.5 c. 2.0 d. 2.5 e. 3.0
a) Given a risk-free rate of 3%, an expected return of the market of 9%. What...
a) Given a risk-free rate of 3%, an expected return of the market of 9%. What is the risk premium for an asset with b = 1? b) What is the required return of an asset with b = 1.6? c) What is the reward to risk ratio? d) What is the expected return on a portfolio of 30% of the asset in b) and the remainder in an asset with an average amount of systematic risk?
3. The risk-free rate is 2%, and the required return on the market is 8%. What...
3. The risk-free rate is 2%, and the required return on the market is 8%. What is the required return on an asset with a beta of 1.2? What is the reward/risk ratio? What is the required return on a portfolio consisting of 80% of the asset with a beta of 1.2 and the rest in an asset with an average amount of systematic risk? 4. Using the CAPM, show that the ratio of the risk premiums on the two...
The risk free rate on a stock is 3%, the required rate in the market is...
The risk free rate on a stock is 3%, the required rate in the market is 7%, and the beta is 1.6. This is the original position. Calculate the required rate of return, r. 2 points, show work Based on the above, now assume that inflation is expected to increase by 2%. Calculate the required rate of return. 2 points, show work What happens to the SML? Circle one: 1 point Shifts Up or Shifts Down or Pivots Up or...
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT