A stock has a beta of 1.2 and an expected return of 9.2%. A risk-free asset has
Fantastic news! We've Found the answer you've been seeking!
Question:
A stock has a beta of 1.2 and an expected return of 9.2%. A risk-free asset has an expected return of 3.5%. What is the stock's "slope" a.k.a. compensation for systematic risk? In other words, if you take a portfolio of the stock and the risk-free asset and then change the weights to increase the beta by 1, how much will the expected return increase as a result? jj
The answer is .0475 please explain how you got this step by step thank you.
Related Book For
Complete Business Statistics
ISBN: 9780077239695
7th Edition
Authors: Amir Aczel, Jayavel Sounderpandian
Posted Date: