Stock R has a beta of 2.5, Stock S has a beta of 0.45, the required return on an average stock is 10%, and the risk-free rate of return is 6%. 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 2.5, Stock S has a beta of 0.45, the required return on an average stock is 10%, and the risk-free rate of return is 6%. 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

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Stock R has a beta of 2.5, Stock S has a beta of 0.45, the required return on an average stock is 10%, and the risk-free rate of return is 6%. By how much does the
required return on the riskler stock exceed the required return on the less risky stock? Round your answer to two decimal places.
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6) see pic
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. %
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