Question: Quantitative Problem: You are given the following information for Wine and Cork Enterprises (WCE): r RF = 4%; r M = 7%; RP M =

Quantitative Problem: You are given the following information for Wine and Cork Enterprises (WCE):

r_RF = 4%; r_M = 7%; RP_M = 3%, and beta = 1.2

What is WCE's required rate of return? Round your answer to 2 decimal places. Do not round intermediate calculations. %

If inflation increases by 3% but there is no change in investors' market risk premium, what is WCE's required rate of return now? Round your answer to two decimal places. Do not round intermediate calculations. %

Assume now that there is no change in inflation, but market risk premium increases by 1%. What is WCE's required rate of return now? Round your answer to two decimal places. Do not round intermediate calculations. %

If inflation increases by 3% and market risk premium increases by 1%, what is WCE's required rate of return now? Round your answer to two decimal places. Do not round intermediate calculations. %

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