Question: Problem 11-13 Using CAPM [LO 4] A stock has a beta of 1.07, the expected return on the market is 10.1 percent, and the risk-free

Problem 11-13 Using CAPM [LO 4]

A stock has a beta of 1.07, the expected return on the market is 10.1 percent, and the risk-free rate is 4.9 percent.

Required:

What must the expected return on this stock be? (Do not round intermediate calculations. Round your answer to 2 decimal places (e.g., 32.16).)

Expected return %

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!

Q:

Problem 11-13 Using CAPM [LO 4] A stock has a beta of 1.22, the expected return on the market is 12 percent, and the risk-free rate is 4.65 percent. Required: What must the expected return on this...

Q:

Problem 11-13 Using CAPM [LO 4] A stock has a beta of 1.15, the expected return on the market is 10.9 percent, and the risk-free rate is 4.5 percent. Required: What must the expected return on this...

Q:

Problem 11-13 Using CAPM [LO 4] A stock has a beta of 1.21, the expected return on the market is 11.5 percent, and the risk-free rate is 4.7 percent. Required: What must the expected return on this...

Q:

Problem 11-13 Using CAPM [LO 4] A stock has a beta of 1.24, the expected return on the market is 11.8 percent, and the risk-free rate is 4.55 percent. Required: What must the expected return on this...

Q:

Problem 11-13 Using CAPM [LO 4] A stock has a beta of 1.22, the expected return on the market is 12 percent, and the risk-free rate is 4.65 percent. What must the expected return on this stock be?...

Q:

t Problem 11-13 Using CAPM [LO 4] A stock has a beta of 1.12, the expected return on the market What must the expected return on this stock be? (Do not round Intermediate calculations and enter your...

Q:

Problem 11-13 Using CAPM (LO 4] A stock has a beta of 1.16, the expected return on the market is 11 percent, and the risk- free rate is 4.45 percent. What must the expected return on this stock be?...

Q:

Problem 11-13 Using CAPM [LO 4) A stock has a beta of 1.19, the expected return on the market is 11.3 percent, and the risk- free rate is 4.8 percent. What must the expected return on this stock be?...

Q:

Problem 11-13 Using CAPM [LO 4 A stock has a beta of 1.24, the expected retum on the market is 11.8 percent, and the risk-free rate is 4.55 percent What must the expected return on this stock be? (Do...

Q:

Problem 13-13 Using CAPM (LO1, 4) A stock has a beta of 1.15, the expected return on the market is 11.9%, and the risk-free rate is 5.4%. What must the expected return on this stock be? (Do not round...

Q:

Financial systems in developing and developed economies have undergone financial sector liberalisation. Basically, a true liberalised financial system is the one in which enough deposits are...

Q:

Calculate the components of a four-vector A and the scalar product of the four-vectors A^ and B^ where (a) A^ = (A^t , A^x , A^y , A^z ) and B^ = (B^t , B^x , B^y , B^z ) in Minkowski space defined...

Q:

My beta is 0 . 1 7 and the value line's beta is 0 . 9 0 . What could explain those two betas not matching?

Q:

last two options for the multiple choice are : performance management development A construction equipment manufacturer, Roswell Corporation, is focusing on becoming a leader in sustainability in...

Q:

For each of the following situations, indicate whether the direct or the indirect organizational plan would be most appropriate and why. (Objective 2) a. One of your sales representatives applied for...

Q:

Explain why spell checkers and style checkers do not replace proofreading. (Objective 2 )

Q:

Using the indirect plan, indicate the most coherent order for these sentences by listing their letters in that order: a. The evening meal is a perfect time for families to talk and share events of...