The risk-free rate is 2.20% and the market risk premium is 6.39%. What will be the expected

Fantastic news! We've Found the answer you've been seeking!

Question:

The risk-free rate is 2.20% and the market risk premium is 6.39%. What will be the expected rate of return for the stock if the beta for the stock is 1.33?

Related Book For answer-question

Fundamentals of Financial Management

ISBN: 978-1285867977

14th edition

Authors: Eugene F. Brigham, Joel F. Houston

See More Books

Posted Date: Apr 24, 2024 08:09 AM

See More Questions

Identify the series and parallel relationships in Figure 674 as seen from the source terminals. Vs 3V + R 10 R5 10 FIGURE 6-74 R 33 R3 33 R4 33
KYC's stock price can go up by 15 percent every year, or down by 10 percent. Both outcomes are equally likely. The risk free rate is 5 percent, and the current stock price of KYC is 100. (a) Price a...
The yield to maturity of a firm's debt is 4%. The tax rate is zero. The beta of its equity is 1.2. The risk-free rate is 1% and the market risk premium is 7%. Of the market value of the debt is 25...
On January 26, Nova Co. borrowed cash from Conrad Bank by issuing a 30-day note with a face amount of $60,000. Assume a 360-day year. a. Determine the proceeds of the note, assuming the note carries...
Explain how the conditions of utility maximization, cost minimization, and profit maximization in competitive markets imply that the allocation arising in a general competitive equilibrium is...
What is meant by the "Castle Doctrine" and the key reasons the doctrine has changed over the years? Contrast the "Castle Doctrine" with the "Make my Day" rules. Which do you agree with and why? If...
A schlieren photo of a bullet moving through air (see Video V11.10) at 14.7 psia and $68^{\circ} \mathrm{F}$ indicates a Mach cone angle of $28^{\circ}$. How fast was the bullet moving in: (a)...
Laworld Inc. manufactures small camping tents. Last year, 200,000 tents were made and sold for $60 each. Each tent includes the following costs: Direct materials .........$18 Direct labor...
A1500 kg aircraft going35 m/s collides with a2000 kg aircraft that is parked and they stick together after the collision and are going 15 m/s after the collision. If they skid for 106.8 m before...
Suppose the market demand curve for a product is given by QD=100-5P and the market supply curve is given by QS=5P a. What are the equilibrium price and quantity? b. At the market equilibrium, what is...
What are the implications of environmental, social, and governance (ESG) factors on risk management frameworks, and how can businesses effectively integrate them into their strategies?
Employee ID First name Last name Job classification Jan Sales 1001 Mary Stevens Senior Sales Rep $ 85,000 1002 Larry Anderson Senior Sales Rep $ 72,000 1003 Sunil Gupta Junior Sales Rep $ 35,000 1004...
University Vision A premier national university that develops leaders in the global knowledge economy. University Mission A university committed to producing leaders by providing a 21st century...
Wilson Distributors, Inc. is a distributor of Miller beer as well as several lesser-known brands. The father owns the business, but he has been gradually turning it over to his son the last few...
Gabby has been laid off from the organization that she has worked at for almost a decade. Mark needs to make sure that Gabbys account is securely handled after her last day of work. What can he do to...
We are getting to a point in art history where we have to talk about art in a different way than before. Theres a lot involved in the process and the intention of the art that isnt always clearly...
In Exercises find dy/dx by implicit differentiation. xy - y = x
(a) Which of the 10 groups has the highest credit card debt and what is the amount? (b) Which of the groups has the least amount of credit card debt? (c) Can you identify any pattern between married...
(a) Which college has the greatest difference in starting salaries? (b) Which college has the highest starting salary for females? (c) Which college has the highest starting salary for males? (d)...
(a) How many of male respondents in this study had some college degree? (b) How would you describe the largest group of respondents? (c) What could be stated about the differences between male and...

The risk-free rate is 2.20% and the market risk premium is 6.39%. What will be the expected

Question:

Expert Answer:

To calculate the expected rate of return for the sto... View the full answer

Fundamentals of Financial Management

Students also viewed these finance questions