A&Z Corporation's stock has a beta of 1.2. The
risk-free rate is 5% and the expected return on the market is
13%.
What is the required rate of return on A&Z Corporation's stock
using the Capital Asset Pricing Model (CAPM)? Show calculations,
please
Required return on Stock as per CAPM = Risk free rate + beta*(Expected Market return - risk free rate)
= 5% + 1.2*(13%-5%)
= 14.6%
Hence, the required rate of return is 14.6%
A&Z Corporation's stock has a beta of 1.2. The risk-free rate is 5% and the expected...
If you know the risk-free rate, the market risk-premium, and the beta of a stock, then using the Capital Asset Pricing Model (CAPM) you will be able to calculate the expected rate of return for the stock. True False
Security X has a rate of return of 13% and a beta of 1.15. The risk-free rate is 5% and the market expected rate of return is 10%. According to the capital asset pricing model, security X is 1) fairly priced 2) underpriced 3) overpriced 4) None of the answers are correct Security X has a rate of return of 13% and a beta of 1.15. The risk-free rate is 5% and the market expected rate of return is 10%....
The Up and Coming Corporation's common stock has a beta of 1.5. If the risk-free rate is 5 percent and the expected return on the market is 13 percent, what is the company's cost of equity capital? (Do not round your intermediate calculations.) Multiple Choice 1768% 17.85% 24,5% 16.15%
Help Question 1 5 pts Centex Energy has a beta of 1.45. Assume that risk-free rate and the expected rate of return on the market are 2% and 12% respectively. According to the capital asset pricing model (CAPM), what is the expected rate of return for this company's stock? Your answer should be between 11.45 and 18.55, rounded to 2 decimal places, with no special characters. Question 2 5 pts
Intro The table below shows information for 3 stocks. Security Beta Risk-free rate Expected market return 1.8 Stock 1 0.02 0.06 1.2 Stock 2 0.035 0.06 Stock 3 0.4 0.015 0.06 The risk-free rates are different because they were measured in different years. Calculate the expected (or required) return for each stock, using the Capital Asset Pricing Model (CAPM). Part 1 B Attempt 1/5 for 10 pts. What is the expected return for stock 1? 3+ decimals Submit Part 2...
Capital Asset Pricing Model Risk-free rate = 5% Return the (stock) Market = 12% Beta = 1.5 Calculate the cost of retained earnings using the Capital Asset Pricing Model.
The Rhaegel Corporation's common stock has a beta of 1.1. If the risk-free rate is 5.1 percent and the expected return on the market is 13 percent, what is the company's cost of equity capital? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g. 32.16.) Cost of equity capital
Stock X has a beta of 1.17 If the risk free rate is 2.9 percent and the market risk premium for the average share of stock is 14.50 percent, what is the expected return for Stock X under the Capital Asset Pricing Model assumptions? 20.36% 19.87% 17.89% 18.57%
1. Question 1 Centex Energy has a beta of 1.41. Assume that risk-free rate and the expected rate of return on the market are 2% and 12% respectively. According to the capital asset pricing model (CAPM), what is the expected rate of return for this company's stock? Your answer should be between 11.45 and 18.55. rounded to 2 decimal places, with no special characters
If the market risk premium is 12.4 percent and the risk-free rate is 4.8, what is the expected rate of return for a stock with a beta of 1.08 under the Capital Asset Pricing Model (CAPM)? (show your answer in decimal form to four places)