Homework Answers
Dear student thankyou for using homeworklib.
Please find the answer below.
Statement showing computation:
Expected return= Risk free rate+beta*(market return-risk free rate)
15= 3+beta*(9-3)
12= beta*6
Beta= 12/6= 2
So correct answer is 2.0
Add Answer to:
Polly Khan is trying to calculate the beta for Builtrite's stock given the following information: The...
Polly Khan is trying to calculate the current market rate given the following information: Investor's have...
Polly Khan is trying to calculate the current market rate given the following information: Investor's have been requiring a 12% annual return on Builtrite's stock which has a beta of 2.0 and the current risk-free rate is 4%. What is the current market rate? 4% 6% 8% O 10%
Mark is trying yo calculate the current market rate given the following information: Investor's have been...
Mark is trying yo calculate the current market rate given the following information: Investor's have been requiring a 12% annual return on Mark's stock which has a beta of 2.0 and the current risk-free rate is 4%. What is the current market rate?
Given the following information, use the CAPM to calculate the beta of the stock. The required...
Given the following information, use the CAPM to calculate the beta of the stock. The required rate of return of the stock is 12%, Risk free interest rate is 4% and market return is 10%.
a) Calculate the required rate of return for Mars Inc.'s stock. The Mars's beta is 1.7...
a) Calculate the required rate of return for Mars Inc.'s stock. The Mars's beta is 1.7 , the rate on a T-bill is 4 percent, the rate on a long-term T-bond is 5.8 percent, the expected return on the market is 11.5 percent, the market has averaged a 14 percent annual return over the last six years, and Mars has averaged a 14.4 return over the last six years. (Do not include the % sign and round to two decimal...
If the current risk-free rate is 6%; Stock A has a beta of 1.0; Stock B...
If the current risk-free rate is 6%; Stock A has a beta of 1.0; Stock B has a beta of 2.0; and the market risk premium, r M – r RF, is positive. Which of the following statements is CORRECT? a. If the risk-free rate increases but the market risk premium stays unchanged, Stock B's required return will increase by more than Stock A's. b. If Stock B's required return is 11%, then the market risk premium is 2.5%. c....
answer a & b please Use the following information. Stock X has a beta of 1.5....
answer a & b please
Use the following information. Stock X has a beta of 1.5. The risk-free rate of return is 4%. The market risk premium is 11%. a) Find the market return (or market portfolio's rate of return). b) Find the required rate of return on Stock Xusing the CAPM.
BETA COEFFICIENT Given the following information, determine the beta coefficient for Stock L that is consistent...
BETA COEFFICIENT Given the following information, determine the beta coefficient for Stock L that is consistent with equilibrium: = 9%; rRF = 3.9%; rM = 11.5%. Round your answer to two decimal places. b) CAPM AND PORTFOLIO RETURN You have been managing a $5 million portfolio that has a beta of 0.75 and a required rate of return of 12%. The current risk-free rate is 3.00%. Assume that you receive another $500,000. If you invest the money in a stock...
PLEASE SHOW EXPLANATION, WORK, AND EQUATIONS 7. Given the following information, determine the beta coefficient for...
PLEASE SHOW EXPLANATION, WORK, AND EQUATIONS
7. Given the following information, determine the beta coefficient for Stock G that is consistent with equilibrium: expected return for Stock G = 9.5%; risk-free rate of return = 3.5%; required return for the market = 9%. 8. Consider the following information for the Alachua Retirement Fund, with a total investment of $4 million. The market required rate of return is 12%, and the risk-free rate is 6%. What is its required rate of...
Stock A's stock has a beta of 1.5, and its required return is 12.00%. Stock B's...
Stock A's stock has a beta of 1.5, and its required return is 12.00%. Stock B's beta is 0.80. If the risk-free rate is 4.75%, what is the required rate of return on B's stock? (Hint: First find the market risk premium using information about stock A.) A. 7.97% O B. 8.62% ○ C. 8.98% ○ D, 9.21% O E. 9.58%
Stock A has a beta of 0.5, and investors expect it to return 5%. Stock B...
Stock A has a beta of 0.5, and investors expect it to return 5%. Stock B has a beta of 1.5, and investors expect it to return 9%. Use the CAPM to calculate the market risk premium and the expected rate of return on the market. (Enter your answers as a whole percent.) a.Market Risk Premium = b.Expected Rate of Return =
Polly Khan is trying to calculate the current market rate given the following information: Investor's have been requiring a 12% annual return on Builtrite's stock which has a beta of 2.0 and the current risk-free rate is 4%. What is the current market rate? 4% 6% 8% O 10%
answer a & b please
Use the following information. Stock X has a beta of 1.5. The risk-free rate of return is 4%. The market risk premium is 11%. a) Find the market return (or market portfolio's rate of return). b) Find the required rate of return on Stock Xusing the CAPM.
PLEASE SHOW EXPLANATION, WORK, AND EQUATIONS
7. Given the following information, determine the beta coefficient for Stock G that is consistent with equilibrium: expected return for Stock G = 9.5%; risk-free rate of return = 3.5%; required return for the market = 9%. 8. Consider the following information for the Alachua Retirement Fund, with a total investment of $4 million. The market required rate of return is 12%, and the risk-free rate is 6%. What is its required rate of...
Stock A's stock has a beta of 1.5, and its required return is 12.00%. Stock B's beta is 0.80. If the risk-free rate is 4.75%, what is the required rate of return on B's stock? (Hint: First find the market risk premium using information about stock A.) A. 7.97% O B. 8.62% ○ C. 8.98% ○ D, 9.21% O E. 9.58%
Most questions answered within 3 hours.
-
Consider the following reaction at equilibrium. What will happen
if O2 is added to the reaction?...
asked 21 minutes ago -
Based on how much or how little you have noticed in the media,
do you think...
asked 2 hours ago -
I calculate Rosetta Stone’s P/E ratio as 10x prior to a report
about future industry growth....
asked 4 hours ago -
What major physiological changes account for electrodermal
activity (as in during a lie-detector test)?
asked 5 hours ago -
You are going to sell fruits & vegetables at a local
roadside market. List separately and...
asked 5 hours ago -
Hows does water affect the digestion of fats ?
asked 8 hours ago -
A buffer that contains 0.41 M of a base, B and 0.21 M of its
conjugate...
asked 8 hours ago -
Pleaaaaaaaasssssse help me please please it's more important
:((((((((((((((((((((
CASE STUDY
Nissan Company
Nissan Motor Company,...
asked 8 hours ago -
Calculate the concentration of hydronium and hyroxide ions in 1)
2.0 mol/L HNO3 2) 0.5 mol/L...
asked 8 hours ago -
In a loop-the-loop ride a car goes around a vertical, circular
loop at a constant speed....
asked 8 hours ago -
50 grams each of water (18.015 g/mol) and ethylene glycol
(C2H6O2) (62.07 g/mol) are mixed. At...
asked 8 hours ago -
The life expectancy of sport utility vehicles follows a normal
distribution with a mean of 145.8...
asked 9 hours ago