Answer the financial accounting question not use ai please don't The risk-free rate of return is currently 4 percent,whereas the market risk premium is 6 percent. If the betaof Lenz, Inc. stock is 1.78, then what is the expected returnon Lenz? Round the answer to 3 decimal places andpresent percentage as a decimal.

Step 1: Define Market Risk PremiumThe additional return that an investor anticipates getting from…

Answered: The risk-free rate of return is…

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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The risk-free rate of return is currently 4 percent, whereas the market risk premium is 6 percent. If the beta of Lenz, Inc. stock is 1.78, then what is the expected return on Lenz? Round the answer to 3 decimal places and present percentage as a decimal.