A stock has a beta of 1.04, the expected return on the market is 10 percent, and the risk-free rate is 3.5 percent. What must the expected return on this stock be? (Do not roundIntermediate calculations and enter your answer as a percent rounded to 2 decimalplaces, e.g., 32.16.)

Cost of equity: It can be defined as the rate of return that is provided by the company to its…

Answered: A stock has a beta of 1.04, the…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Similar questions

A stock has an expected return of 15.2 percent, the risk-free rate is 3.4 percent, and the market risk premium is 9.3 percent. What must the beta of this stock be? (Do not round intermediate calculations. Round your answer to 2 decimal places.)
Stock X has a beta of 2.5, Stock B has a beta of 0.65, the required return on an average stock is 13%, and the risk-free rate of return is 5%. By how much does the required return on the riskier stock exceed the required return on the less risky stock? Round your answer to two decimal places.
A stock has an expected return of 11 percent, its beta is 1.20, and the risk-free rate is 4.4 percent. What must the expected return on the market be? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Answer is complete but not entirely correct. 12.32% Market expected return
A stock has an expected return of 11.4%, the risk-free rate is 5.5%, and the market risk premium is 11%. What must the beta of this stock be? (Do not round intermediate calculations. Round your answer to 2 decimal places.)
A stock's beta is 1.5 and the market risk premium is 5.6%. If the risk-free rate is 2.9%, what is the stock's required return according to CAPM? Answer as a percent and round to 2 decimal places. Answer:
Stock A has a beta of 1, the risk-free rate is 4% and the return on the market is 9%. If the market risk premium changes by 7%, by how much will the required return on Stock A change? (i.e. required return after change - required return before the change) answer format: show your answer in percent (without the % sign) and to 1 decimal place. For example, 12.56 should be shown as 12.6
Stock R has a beta of 2.0, Stock S has a beta of 0.35, the required return on an average stock is 9%, and the risk-free rate of return is 3%. By how much does the required return on the riskier stock exceed the required return on the less risky stock? Round your answer to two decimal places. %
Stock R has a beta of 1.7, Stock S has a beta of 0.8, the required return on an average stock is 13%, and the risk-free rate of return is 5%. By how much does the required return on the riskier stock exceed the required return on the less risky stock? Round your answer to two decimal places.
A stock has a beta of 1.11, the expected return on the market is 10.5 percent, and the risk- free rate is 4.7 percent. What must the expected return on this stock be? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Expected return 4 %
Stock R has a beta of 1.5, Stock S has a beta of 0.85, the required return on an average stock is 9%, and the risk-free rate of return is 3%. By how much does the required return on the riskier stock exceed the required return on the less risky stock? Round your answer to two decimal places.
You have a portfolio consisting solely of Stock A and Stock B. The portfolio has an expected return of 10.9 percent. Stock A has an expected return of 13.4 percent while Stock B is expected to return 7.3 percent. What is the portfolio weight of Stock A? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
A stock has a beta of 0.81, the expected return on the market is 11%, and the risk- free rate is 10.5%. What must the expected return on this stock be? (Do not round intermediate calculations. Enter answer as a percent rounded to 2 decimal places.)

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A stock has a beta of 1.04, the expected return on the market is 10 percent, and the risk- free rate is 3.5 percent. What must the expected return on this stock be? (Do not round Intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)