Consider the CAPM. The risk-free rate is 5% and the expected return on the market is 15%. What is the beta on a stock with an expected return of 12%? a) 0.5 b) 0.7 c) 1.2 d) 1.4
Consider the CAPM. The risk-free rate is 5% and the expected return on the market is 15%. What is the beta on a stock with an expected return of 12%? a) 0.5 b) 0.7 c) 1.2 d) 1.4
Chapter6: Risk And Return
Section: Chapter Questions
Problem 14P
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Financial accounting
Transcribed Image Text:Consider the CAPM. The risk-free rate is 5%
and the expected return on the market is
15%. What is the beta on a stock with an
expected return of 12%?
a) 0.5
b) 0.7
c) 1.2
d) 1.4
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