Exxon Mobil Corporation, BP p.l.c., and Total S.A. are three “super major” integrated oil and gas companies headquartered, respectively, in the United States, the United Kingdom, and France. An analyst estimates that the equity risk premium in the United States, the United Kingdom, and the Eurozone are, respectively, 4.5 percent, 4.1 percent, and 4.0 percent. Other information is summarized in Exhibit 4.

Using the capital asset pricing model, calculate the required return on equity for i. Exxon Mobil.
ii. BP p.l.c.
iii. Total.

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EXHIBIT 4 Exxon Mobil, BP, and Total Estimated Equity Risk-Free Company Beta Risk Premium Rate Exxon Mobil Corp (NYSE:XOM) 0.77 4.5% 3.20% BP p.l.c. (LSE SETS: BP, NYSE: BP) 1.99 4.1 3.56 Total S.A. (Euronext: FR0000120271, NYSE: TOT) 1.53 4.0 2.46