Question: Need Help! Not sure what I'm calculating wrong. Return to question Assume that the risk-free rate of interest is 6% and the expected rate of

Need Help! Not sure what I'm calculating wrong.

Return to question Assume that the risk-free rate of interest is 6% and the expected rate of return on the market is 16%. I am buying a firm with an expected perpetual cash flow of $1,000 but am unsure of its risk. If I think the beta of the firm is.5, when in fact the beta is really 1, how much more will I offer for the firm than it is truly worth? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Answer is complete but not entirely correct. Amount offered in excess $ 4,464.29

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