4. You Corp, has a beta of.80. if the expected market return is 10 percent and...
(Capital Asset Pricing Model) CSB, Inc. has a beta of 0.756. If the expected market return is 12.5 percent and the risk-free rate is 6.0 percent, what is the appropriate expected return of CSB (using the CAPM)? The appropriate expected return of CSB is %. (Round to two decimal places.)
16. Using CAPM A stock has an expected return of 10.2 percent and a beta of .91, and the expected return on the market is 10.8 percent. What must the risk-free rate be?
A stock has a beta of .75, the expected return on the market is 11 percent, and the risk-free rate is 4 percent. a. What must the expected return on this stock be? b. Draw the Security Market Line (SML) -be sure to label all relevant points- c. Suppose the risk free rate falls to 3%. What is the expected return on this stock? Redraw the SML. How has the shape of the curve changed? d. ...
What is the expected market rate of return if Rowdy Corp. has a beta of 0.8, the risk-free rate of return is equal to 2 percent, and the required rate of return for Rowdy is 10%. Assume that Rowdy’s average rate of return over the last 10 years is 9.5%.
7. 16. Using CAPM. A stock has an expected return of 10.2 percent and a beta of.91, and the expected return on the market is 10.8 percent. What must the risk-free rate be?
13. Using CAPM (LO1, 4) A stock has a beta of 1.15, the expected return on the market is 10.3 percent, and the risk-free rate is 3.8 percent. What must the expected return on this stock be?
Suppose you observe the following situation: Security Pete Beta 1.25 Expected Return .1323 Corp. Repete Co. .87 .0967 a. Assume these securities are correctly priced. Based on the CAPM, what is the expected return on the market? (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.) b.What is the risk-free rate? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)...
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?
Stock A has a beta of 1.70 and an expected return of 19.5 percent. Stock B has a beta of 1.10 and an expected return of 14 percent. If CAPM holds, what should the return on the market and the risk-free rate be?
A stock has a beta of 1.38, the expected return on the market is 10 percent, and the risk- free rate is 5 percent. What must the expected return on this stock be? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) 3 11.90% Expected return points еВook Print References