1. Assume the risk-free rate is 2.25%. What is the risk premium for a stock with an expected return of 13.75%, standard deviation of 15%, and beta of 1.15?

2. Assume the expected return on the market is 9% and T-bills pay 2.5%. If a stock has a beta of 1.6, what is its expected return?

Answer rating: 100% (QA)

1 To calculate the risk premium for the stock with the given information we use the Capital Asset Pr... View the full answer