MFI Inc. has a beta of 0.86. If the expected market return is 11.5 percent and the risk- free rate is 3 percent, what is the appropriate required return of MFI (using the CAPM)?
Answer to relevant QuestionsThe expected return for the general market is 12.8 percent, and the risk premium in the market is 9.3 percent. Tasaco, LBM, and Exxos have betas of 0.864, 0.693, and 0.575, respectively. What are the corresponding required ...Given the following probabilities and returns for Mik’s Corporation, find the standard deviation. PROBABILITY RETURNS 0.40........... 7% 0.25........... 4% 0.15........... 18% 0.20........... 10% Explain the three factors that determine the intrinsic, or economic, value of an asset. You own a bond that has a par value of $ 1,000 and matures in 5 years. It pays a 5 percent annual coupon rate. The bond currently sells for $ 1,100. What is the bond’s expected rate of return? You own a 10- year bond that pays 6 percent interest annually. The par value of the bond is $ 1,000 and the market price of the bond is $ 900. What is the yield to maturity of the bond?
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