Question: please answer questions 4 & 5 4) Assume that a stock has a beta of 1.5, the risk free interest rate is 4%,a and the
4) Assume that a stock has a beta of 1.5, the risk free interest rate is 4%,a and the market return is 6%. Find the stock return (expected return). 5) Assume that it costs $1,000 to start a project. If the project will give $400 profit in the first year, $500 in the second year and $300 in the third year. find the pay back period. Now assume that the interest rate is 10%, find the net present value (NPV) and the profitability index (PI) for this project
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