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Part 1

Manipulating CAPMUse the basic equation for the capital asset pricing model

(CAPM)

to work each of the following problems.a.Find the required return for an asset with a beta of

1.36

when the risk-free rate and market return are

10%

and

12%,

respectively. b.Find the risk-free rate for a firm with a required return of

10.711%

and a beta of

0.83

when the market return is

12%.

c.Find the market return for an asset with a required return of

12.381%

and a beta of

1.17

when the risk-free rate is

9%.

d.Find the beta for an asset with a required return of

23.896%

when the risk-free rate and market return are

9%

and

16.6%,

respectively.

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Part 1

a.The required return for an asset with a beta of

1.36

when the risk-free rate and market return are

10%

and

12%,

respectively, is

enter your response here%.

(Round to two decimal places.)