A company has a beta of 1.79. If the market return is expected to be 18.4 percent and the risk-free rate is 6.20 percent, what is the company's risk premium?
Correct Answer is option C
Risk premium = Rm - Rf
Risk premium = Market risk - Risk free rate
Risk premium = 18.4 -6.4
Risk premium = 12.00%
Risk premium is positive if the investor is risk
averse.
I hope this clear your doubt.
Feel free to comment if you still have any query or need something else. I'll help asap.
Do give a thumbs up if you find this helpful.
A company has a beta of 1.79. If the market return is expected to be 18.4...
Company Risk Premium A company has a beta of 4.57. If the market return is expected to be 14.70 percent and the risk-free rate is 7.35 percent, what is the company's risk premium?
A company has a beta of 1.92. If the market return is expected to be 19.7 percent and the risk-free rate is 6.85 percent, what is the company's risk premium?
Company Risk Premium A company has a beta of 4.68. If the market return is expected to be 15.80 percent and the risk-free rate is 7.90 percent, what is the company's risk premium? 28.38 percent 7.90 percent 44.87 percent 36.97 percent
Netflix, Inc. has a beta of 2.94. If the market return is expected to be 13.70 percent and the risk-free rate is 6.20 percent, what is Netflix's risk premium? (Round your answer to 2 decimal places.)
CAPM Required Return A company has a beta of .58. If the market return is expected to be 12.8 percent and the risk-free rate is 5.40 percent, what is the company's required return?
CAPM Required Return A company has a beta of .68. If the market return is expected to be 13.8 percent and the risk-free rate is 5.90 percent, what is the company's required return? Multiple Cholce 1717% 9.38% 15.28% 11.27%
A stock has an expected return of 15.00%. The risk-free rate is 1.79% and the market risk premium is 10.37%. What is the β of the stock?
CAPM Required Return A company has a beta of .63. If the market return is expected to be 13.3 percent and the risk-free rate is 5.65 percent, what is the company's required return? A. 14.03% B. 10.47% C. 8.38% D. 16.12%
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...
Netflix, Inc. has a beta of 3.95. If the market return is expected to be 7.30 percent and the risk-free rate is 3.10 percent, what is Netflix's risk premium? (Round your answer to 2 decimal places.) Netflix's risk premium 19.69