AA Corporation's stock has a beta of 1.2. The risk-free rate is 3.75% and the expected return on the market is 12.92%. What is the required rate of return on AA's stock?
AA Corporation's stock has a beta of 1.2. The risk-free rate is 3.75% and the expected return on the market is 12.92%. What is the required rate of return on AA's stock?
Intermediate Financial Management (MindTap Course List)
13th Edition
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
Publisher:Eugene F. Brigham, Phillip R. Daves
Chapter2: Risk And Return: Part I
Section: Chapter Questions
Problem 4P: An analyst has modeled the stock of a company using the Fama-French three-factor model. The market...
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
Transcribed Image Text:AA Corporation's stock has a beta of 1.2. The risk-free
rate is 3.75% and the expected return on the market
is 12.92%.
What is the required rate of return on AA's stock?
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