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Suppose the​ risk-free return is 7.8% and the market portfolio has an expected return of 8.4%...

Suppose the​ risk-free return is 7.8% and the market portfolio has an expected return of 8.4% and a standard deviation of 16%. Johnson​ & Johnson Corporation stock has a beta of 0.32.

What is its expected​ return? The expected return is?

​(Round to two decimal​ places.)

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Answer #1

Expected return (0) Rf+BxRp Here, Risk free rate of return (RF) Beta of the stock (B) Market risk premium (Rp) 7.8% 0.32 8.4%

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