Suppose Stock A has a return of 10.36%. The risk-free rate is 4.15%. The inflation rate is 2.02%. What is the risk premium on Stock A?
Note: Enter your answer in percentages rounded off to two decimal points. Do not enter % in the answer box. For example, if your answer is 0.12345 then enter as 12.35 in the answer box.
Risk premium=Stock return-risk free rate-inflation rate
Risk premium=10.36%-4.15%-2.02%
Risk premium=4.19%
Suppose Stock A has a return of 10.36%. The risk-free rate is 4.15%. The inflation rate...
ABC Company's stock has a beta of 1.95, the risk-free rate is 2.25%, and the market risk premium is 6.75%. What is ABC's required rate of return using CAPM? Enter your answer rounded to two decimal places. Do not enter % in the answer box. For example, if your answer is 0.12345 or 12.345% then enter as 12.35 in the answer box. Ripken Iron Works believes the following probability distribution exists for its stock. What is the standard deviation of...
1. You purchased one share of Kohl's Corporation, Inc for $50.47 per share. The company paid a dividend of $5.26 per share during the year, and had an ending share price of $48.91. What is the capital gains yield? Note: Enter your answer in percentages rounded off to two decimal points. Do not enter % in the answer box. For example, if your answer is 0.12345 then enter as 12.35 in the answer box. 2. You purchased 206 shares of...
Question 22 Stock Y has an expected return of 14% and beta of 1.80. Stock Z has an expected return of 11.50% and beta of 1.10. If the risk-free rate is 3.5% and the market risk premium is 6.5%, which security is overvalued? Stock Y, because it plots below the SML Stock Z, because it plots below the SML Stock Z, because it plots above the SML Stock Y, because it plots above the SML No answer text provided. Flag...
The stock of Target Corporation has a beta of 1.17. The market risk premium is 7.97 percent and the risk-free rate is 3.14 percent. What is the required rate of return on this stock? Use the CAPM Equation Note: Enter your answer in percentages rounded off to two decimal points. Do not enter % in the answer box.
1.Suppose the nominal rate is 15.62% and the inflation rate is 2.37%. What is the real rate? Use the Fisher Equation to get the answer.Note: Convert your answer to percentage and round off to two decimal points. Do not enter % in the answer box. 2.ABC, Inc., has a beta of 1.19. The risk-free rate is 2.91% and the market risk premium is 7.89%. What is the required rate of return on ABC's stock?Note: Convert your answer to percentage and...
Suppose Stock A has a return of 12.71%. The risk-free rate is 4.84%. The inflation rate is 1.23%. What is the risk premium on Stock A?
Question 121 pts You purchased one share of Best Buy CO., Inc for $59.38 per share. The company paid a dividend of $7.08 per share during the year, and had an ending share price of $60. What is the percentage return? Note: Enter your answer in percentages rounded off to two decimal points. Do not enter % in the answer box. For example, if your answer is 0.12345 then enter as 12.35 in the answer box. Question 131 pts You...
1. You purchased one share of Best Buy CO., Inc for $53.10 per share. The company paid a dividend of $4.54 per share during the year, and had an ending share price of $52. What is the percentage return? Note: Enter your answer in percentages rounded off to two decimal points. Do not enter % in the answer box. For example, if your answer is 0.12345 then enter as 12.35 in the answer box. 2. You purchased one share of...
Medium Size Retailer Corporation's (MSRC) 5-year bonds yield 8.75%, and 5-year T-bonds yield 4.50%. The real risk-free rate is r* = 2.45%, the inflation premium for 5-year bonds is IP = 1.65%, the default risk premium for MSRC's bonds is DRP = 2.85% versus zero for T-bonds, and the maturity risk premium for all bonds is found with the formula MRP = (t – 1) x 0.1%, where t = number of years to maturity. What is the liquidity premium...
Question 51 pts You have observed the following returns on Stock A's stocks over the last five years: 2.65%, 7.38%, -1.3%, -3.43%, 16.32% What is the average return on the stock over this five-year period? Note: Enter your answer in percentages rounded off to two decimal points. Do not enter % in the answer box. If the answer is negative, do enter the negative sign. Question 61 pts You purchased 114 shares of Best Buy CO., Inc for $57.96 per...