The risk-free rate is 6 percent and the expected market risk premium is 8 percent. What is the expected rate of return on a stock with a beta of 0.7? 5.6 percent   11.6 percent   15.8 percent   9.8 percent   14.0 percent

Q: A stock has a beta of 1.09, the expected return on the market is 10.3 percent, and the risk-free…

A: Given Beta is 1.09 Expected return on market is 10.3% Risk free rate is 4.8%

Q: A stock has a beta of 1.3, the expected return on the market is 11 percent, and the risk-free rate…

A: The Capital Asset Pricing Model (CAPM) refers to the model which tells us how the financial markets…

Q: A stock has an expected return of 15.7 percent, the risk-free rate is 6.25 percent, and the market…

A: Given The expected return is 15.7 percent Risk free rate is 6.25% Market risk premium is 7.6%

Q: The risk-free rate is 4%. The market risk-premium is 7%. The beta is 2.0. What is the expected rate…

A: Financial statements are statements which states the business activities performed by the company .…

Q: The expected return for a stock, calculated using the CAPM is 13.5%. The risk free rate is 7.5% and…

A: In the given problem we are required to calculate the implied return on market using following…

Q: The risk-free rate is 2.2 percent and the market expected return is 11.9 percent.  What is the…

A: To calculate the expected return of a stock with a given beta,  the capital asset pricing model…

Q: Using CAPM A stock has an expected return of 13 percent, the risk-free rate is 4.5 percent, and the…

A: Given details are : Expected return = 13% Risk free rate = 4.5% Market risk premium = 7% We need to…

Q: Stock Y has a beta of 1.50 and an expected return of 14.2 percent. Stock Z has a beta of .85 and an…

A: CAPM is the capital asset pricing model and is used to find the required return using the following…

Q: A stock has an expected return of 9.10%, the risk-free rate is 8.00% and the return on the market is…

A: Step 1: The calculation of the stock's beta AB1Expected return (r )9.10%2Risk-free rate…

Q: The common stock of Alpha Gamma has an expected return of 10.6 percent. The risk-free rate is 3.5…

A: The expected return on a stock is dependent upon the risk free rate;the prevailing market rate of…

Q: Stock A's stock has a beta of 1.20, and its required return is 12.25%.  Stock B's beta is 0.80.  If…

A: Given Information : Stock A's Beta - 1.20 Stock A's Required return - 12.25% Stock B's Beta - 0.80…

Q: The risk-free rate of return is 4.24 percent and the market risk premium is 9.5 percent. What is the…

A: To calculate the expected return we will use the below formula   Expected return = Risk free rate +…

Q: Assume that the risk-free rate is 6.5% and the market risk premium is 5%. What is the required…

A: Solution:-Capital Asset Pricing Model (CAPM) is a model which gives a formula to calculate the…

Q: Beta and required rate of return A stock has a required return of 11 percent; the risk-free rate is…

A: In the given question we require to compute the beta of stock from below details : Required return =…

Q: A stock has an expected return of 13.87 percent. The beta of the stock is 1.7 and the risk-free rate…

A: Expected Return = r = 13.87%Beta = b = 1.7Risk free rate = rf = 5%Market Risk Premium = mrp = ?

Q: A stock has an expected return of 7.8 percent. The expected return on the market is 9 percent and…

A: Beta less than 1 signifies less systematic risk.

Q: A stock has a beta of 1.38. The risk free rate is 0.817% and the market risk premium is 5%. What is…

A: Solution:- Capital Asset Pricing Model (CAPM) is the model which helps to compute the fair return on…

Q: Assume that the risk-free rate is 4% and the expected return on the market is 11.5%. What is the…

A: The Capital Asset Pricing Model (CAPM) is a tool used in finance to estimate the cost of equity,…

Q: A stock has a beta of 1.16, the expected return on the market is 11 percent, and the risk-free rate…

A: To calculate the expected return on this stock we will use the below formula   Expected return =…

Q: A stock has an expected return of 10.99 percent, the risk-free rate is 2.46 percent, and the market…

A: Expected return = 10.99%Risk-free rate = 2.46%Market risk premium = 4.95%To find: Beta of the stock.…

Q: Which one of the following stocks is correctly priced if the risk-free rate of return is 3.0 percent…

A: In this question, we are required to determine the stock which is correctly priced.

Q: The risk-free rate of return is 3.75 percent and the market risk premium is 6.5 percent. What is the…

A: Risk free rate of return = rf = 3.75% Market risk premium = mrp = 6.5% Beta = b = 0.84

Q: A stock has an expected return of 12.69 percent and its reward-to-risk ratio is 7.6 percent. If the…

A: In this question, we are required to determine the value of beta.

Q: A stock has an expected return of 16 percent, its beta is 0.6, and the risk-free rate is 6.4…

A: Given the following information: Expected return on stock (r) = 16% Beta (b) = 0.6 Risk free rate…

Q: A stock has a beta of 1.68, the expected return on the market is 14.72, and the risk-free rate is…

A: As per CAPM formula Expected return on stock = Risk free return + Beta*(Market return-Risk free…

Q: What is the required rate of return on a stock with a beta of 1.2, when the risk-free rate is 3.6%…

A: Risk-free rate = 3.6%Market return = 14.4%Beta = 1.2The required rate of return on a stock is a…

Q: The risk-free rate is 6.8 percent, and stock A has an expected return of 15.8 percent. What is the…

A: In order to calculate the beta of  market the  capital Asset pricing models , the three variables…

Q: Consider the CAPM. The risk-free rate is 6%, and the expected return on the market is 18%. What is…

A: In the given question we need to calculate the expected return on a stock using CAPM i.e. Capital…

Q: Assume that the risk-free rate is 6.5% and the market risk premium is 8%. What is the required…

A: The CAPM is used to find out the return of a stock based on the systematic risk the stock faces and…

Q: A stock has a beta of 1.17 and an expected return of 11.21 percent. If the risk-free rate is 3.2…

A: Given: Expected return = 11.21% Risk-free rate = 3.2% Beta = 1.17 Solution: Reward to Risk Ratio =…

Q: Stock A has an expected return of 13.52 percent. Stock B has an expected return of 9.24 percent.…

A: The concept in question is based on the Capital Asset Pricing Model (CAPM), a finance theory used to…

Q: A stock has a beta of​ 1.3, and a market risk premium of​ 8%. The​ risk-free rate is​ 4%. What is…

A: The objective of this question is to calculate the expected return on a stock given its beta, the…

Q: A stock has an expected return of 15.75 percent. The beta of the stock is 1.9 and the risk-free rate…

A: In the given case, we have provided the expected return , beta of the stock and the risk-free…