Question: Exhibit 8.2 USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S) You expect the risk-free rate (RFR) to be 3 percent and the market return to

Exhibit 8.2 USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S) You expect the risk-free rate (RFR) to be 3 percent and the market return to be 8 percent. You also have the following information about three stocks. Stock Beta 1.25 Y 1.50 Z 0.90 Current Price $20 $27 Expected Price $23 $29 $38 Expected Dividend $1.25 $0.25 $1.00 $35 13. a. Refer to Exhibit 8.2. What are the expected (required) rates of return for the three stocks (in the order X, Y, Z)? 16.50%, 5.50%, 22.00% b. 9.25%, 10.5%, 7.5% 21.25%, 8.33%, 11.43% d. 6.20%, 2.20%, 8.20% e. 15.00%, 3.50%, 7.30% C. 14. Refer to Exhibit 8.2. What are the estimated rates of return for the three stocks in the order X, Y, Z)? 21.25%, 8.33%, 11.43% b. 6.20%, 2.20%, 8.20% c. 16.50%, 5.50%, 22.00% a. d. e. 9.25%, 10.5%, 7.5% 15.00%, 3.50%, 7.30%
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