Company Forecasted return Standard deviation of return Beta The T-bill rate is 2% and the market...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Company Forecasted return Standard deviation of return Beta The T-bill rate is 2% and the market risk premium is 7.5%: Accenture PLC (ACN) Infosys Ltd. (INFY) 12.0% 15.0% 0.85 4.0% 10.0% 1.00 The expected return for each firm according to the Capital Asset Pricing Model (CAPM) would be? Company Forecasted return Standard deviation of return Beta The T-bill rate is 2% and the market risk premium is 7.5%: Accenture PLC (ACN) Infosys Ltd. (INFY) 12.0% 15.0% 0.85 4.0% 10.0% 1.00 The expected return for each firm according to the Capital Asset Pricing Model (CAPM) would be?
Expert Answer:
Answer rating: 100% (QA)
Calculate the expected return for each firm as follows For Accenture PLC ACN Expected Return R... View the full answer
Related Book For
Posted Date:
Students also viewed these finance questions
-
1. The famous capital asset pricing model or CAPM is a single factor model that characterizes the portion of an assets total return that results from systematic movements in the broader market. It is...
-
The CFO of Bunyan Lumber Corporation, Anita Rai has decided to invest some money in the financial market to diversify the risks of business operations and increase rate of return. She has been...
-
The beta for the equity in Fullsome Corporation is 0.95. The market risk premium is 7 per cent, and the risk-free rate is 4 per cent. Fullsome has a target debt/equity ratio of 25 per cent. Its cost...
-
You have three light bulbs; bulb A has a resistance of 240 , bulb B has a resistance of 192 , and bulb C has a resistance of 144 . Each of these bulbs is used for the same amount of time in a setup...
-
StoreAll produces plastic storage bins for household storage needs. The company makes two sizes of bins: large (50 gallon) and regular (35 gallon). Demand for the product is so high that StoreAll can...
-
The following table gives the total value (in millions of dollars) of shipments of beet sugar manufactured in the United States from 2008 and projected to 2020. Construct a frequency histogram of the...
-
Redesign the system in Problem 6.14 with the following equipment: The owner of a small cabin would like to convert her home to PV power. She has the following equipment and associated run times: PV...
-
The Brownstone Corporations bonds have 5 years remaining to maturity. Interest is paid annually, the bonds have a $1,000 par value, and the coupon interest rate is 9%. a. What is the yield to...
-
Don may not be the brightest candle on the cake. He has more taxes withheld from his paycheck so he will get a large check come April from the Federal government. Well, this check came in the mail...
-
Wayland Custom Woodworking is a firm that manufactures custom cabinets and woodwork for business and residential customers. Students will have the opportunity to establish payroll records and to...
-
Solving a compound linear inequal Solve the compound inequality. 2u-6>4 or ,-3u <9 notation.
-
A 3.27kg object hangs, at rest, on a 2.19m long string attached to the ceiling. A 90g object is fired with a speed of 8m/s at the 3.27kg object, and the two objects collide and stick together in a...
-
Suppose the following auxiliary equations is estimated on observations 4 to 40 e t = 2.34 + .054 X 1 + 2.33 X 2 - .012 e t-1 -.430 e t-2 - 1.40e t-3 R 2 = .25 Carry out a LM test for Higher order...
-
We have three input/output prototype vector pairs: P = = = 1} { = H 2 = -} {0 = [1] 3 = 1} 2 2 P3 i. Show that this problem cannot be solved unless the network uses a bias. ii. Use the pseudoinverse...
-
3. Jade is deciding how much to work in 2020. She derives utility from consumption,C, but she also really likes taking leisure time L. She must divide her available hours between work and leisure....
-
Identify errors in the following program segment and rewrite the correct statements. #include int main() ( integer x, total, y; x = y; print ("Enter the value for x:"); scanf("%d", total); total...
-
Cullumber & Co. sold goods with a market price of $126000 on April 1. They accepted a note from Marin Inc. for $126000 due in two years, with interest paid each year on April 1, bearing 8% interest....
-
The packaging division of a company having considered several alternative package designs for the company's new product has finally brought down their choices to two designs of which only one has to...
-
a. Pamela Itsuji, a currency trader for a Japanese bank, is evaluating the price of a 6-month Japanese yen/U.S. dollar currency futures contract. She gathers the following currency and interest rate...
-
Convert the asset returns by decade presented in the table into real rates. Repeat the analysis of Challenge Problem 20 for the real rates ofreturn. 1940s 1950s 1960s 1970s 1980s 1990s 1920s -3.72%...
-
Joseph Jones, a manager at Computer Science, Inc. (CSI), received 10,000 shares of company stock as part of his compensation package. The stock currently sells at $40 a share. Joseph would like to...
-
Describe the quick return motion mechanism for a shaper.
-
What is the purpose of a drilling machine ? Explain its working principle.
-
How drilling machines are classified?
Study smarter with the SolutionInn App