Beta A stock has a beta of 1.5. If the market sees a jump in value...

Question

Question

Beta

A stock has a beta of 1.5. If the market sees a jump in value of 10% over a particular period,

what is the expected jump in value for the stock (in percent terms?)

Answer 1

Answer #1

Ans: - Beta is defined as: - Change in Stock Price / Change in Market Value

As in given question beta = 1.5, Change in stock = 10% Increase

Hence change in stock = 1.5*10 = 15% Rise in Value

Answer 2

Similar Homework Help Questions

16,17,18 stock has a beta of 1.5, the expected return on the market is 11 percent,...

16,17,18 stock has a beta of 1.5, the expected return on the market is 11 percent, and the risk- Free rate is 3.85 percent. What must the expected return on this stock be? Multiple Choice 15.16% O 20.35% O 13.85% O 15.3% O The Bet-r-Bilt Company has a 5-year bond outstanding with a 3.70 percent coupon. Interest payments are paid semi-annually. The face amount of the bond is $1,000. This bond is currently selling for 90 percent of its face...
Crane Industries common stock has a beta of 1.5. If the market risk-free rate is 3.6...

Crane Industries common stock has a beta of 1.5. If the market risk-free rate is 3.6 percent and the expected return on the market is 8.0 percent, what is Crane’s cost of common stock? (Round answer to 1 decimal places, e.g. 15.2%.) Cost of common stock____%
1. The stock of Ford has a beta of 1.5, and the stock of Tesla has...

1. The stock of Ford has a beta of 1.5, and the stock of Tesla has a beta of 0.4. The expected rate of return on the market is 8 percent, and the risk free rate is 1 percent. By how much does the required return on Ford exceed the required return on Tesla? (CAPM)

5. The stock of Ford has a beta of 1.5. and the stock of Tesla has a beta of 0.4. The expected rate of return on t...

5. The stock of Ford has a beta of 1.5. and the stock of Tesla has a beta of 0.4. The expected rate of return on the market is 8 percent, and the risk free rate is 1 percent. By how much does the required return on Ford exceed the required return on Tesla? (CAPM)
A stock has a beta of 1.5 and an expected return of 13.3 percent. If the...

A stock has a beta of 1.5 and an expected return of 13.3 percent. If the risk-free rate is 1.7 percent, what is the market risk premium? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) Market risk premium
A stock has a beta of 1.5 and an expected return of 13.3 percent. If the...

A stock has a beta of 1.5 and an expected return of 13.3 percent. If the risk-free rate is 4.1 percent, what is the market risk premium?(Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) Market risk premium %

5. The stock of Ford has a beta of 1.5, and the stock o expected rate of return on the market is 8 percent, and h...

5. The stock of Ford has a beta of 1.5, and the stock o expected rate of return on the market is 8 percent, and how much does the required return on Ford exceed (CAPM) required remarket is 8 peto stock of Tesla has a beta of 0.4.cent. By d the risk free rate is 1 percent. aceed the required return on te return on Tesla?
Stock R has a beta of 1.5,Stock S has a beta of 0.75, the expected rate...

Stock R has a beta of 1.5,Stock S has a beta of 0.75, the expected rate of return on an average stock is 13 percent, and the risk-free rate of return is 7 percent. By how much does the required return on the riskier stock exceed the required return on the less risky stock?
14. a) RBC stock has a beta of 0.85, while TD stock has a beta of...

14. a) RBC stock has a beta of 0.85, while TD stock has a beta of 1.21. The risk-free rate is 1.5%, and the expected return on a portfolio with 50% weight in RBC and the remainder in TD is 9.74%. What is the market risk premium? b) You are offered an opportunity to invest in a stock that has a beta of 1.5. If the risk-free rate is 2.4%, and the expected market return is 10%, what is the...

Stock A has a beta of 1.5 and Stock B has a beta of 0.5. Which...

Stock A has a beta of 1.5 and Stock B has a beta of 0.5. Which of the following statements MUST BE TRUE about these securities, for all investors? (Assume the market is in equilibrium.) Group of answer choices Stock A’s return will always be three times higher than Stock B’s return. Stock B would be a more desirable addition to a portfolio than Stock A. Stock A would be a more desirable addition to a portfolio than Stock B....