A stock has a beta of .85, the expected return on the market is 11 percent, and the risk-free rate is 3 percent. What must the expected return on this stock be?

Q: A stock has an required return of 16.5 percent, its beta is 1.75, and the risk-free rate is 2.75…

A: Expected rate of return = R = 16.5% Beta = 1.75 Risk free rate = rf = 2.75%

Q: A stock has a beta of 1.09, the expected return on the market is 10.3 percent, and the risk-free…

A: Given Beta is 1.09 Expected return on market is 10.3% Risk free rate is 4.8%

Q: A stock has a beta of 1.78 The risk free rate is 1.314% and the market risk premium is 5% What is…

A: Fair return on stock :— It is the sum of risk free rate of return and beta multiplied with market…

Q: B. Assume the required return on the market is 7.5% and the risk-free rate is 2.1%. What is the…

A: Given details are : Required return of market (Rm) = 7.5% Risk free rate (Rf) = 2.1% Beta = 0.7 From…

Q: A stock has an expected return of 15.7 percent, the risk-free rate is 6.25 percent, and the market…

A: Given The expected return is 15.7 percent Risk free rate is 6.25% Market risk premium is 7.6%

Q: The risk- free rate is 5% and the expected return on the market portfolio is 13%. A stock has a beta…

A: The expected return can be computed by using the Capital asset pricing model (CAPM).  As per CAPM,…

Q: The risk-free rate is 2.2 percent and the market expected return is 11.9 percent.  What is the…

A: To calculate the expected return of a stock with a given beta,  the capital asset pricing model…

Q: A stock has a beta of 0.60 the expected return on the market is 14percent and the risk free rate is…

A: An expected return on stock is the expectation of the shareholder about the amount of gain or loss…

Q: A stock has an expected return of 10% and a beta of .9. If the risk-free rate is 4%, what is the…

A: The beta of the stock can be calculated as per the CAPM equation

Q: Assume a stock has a required return on equity, ?? = 12%. The risk-free rate is ?? = 5% and the…

A: The mathematical equation for the concept is:

Q: Calcitron Inc. has common stock with a beta of 1.4. The risk-free rate is 3.7 while the market rate…

A: Required rate is rate which is expected by investors and can be calculated based on the risk…

Q: The common stock of Alpha Gamma has an expected return of 10.6 percent. The risk-free rate is 3.5…

A: The expected return on a stock is dependent upon the risk free rate;the prevailing market rate of…

Q: A stock has a beta of 1.9. The risk-free rate is 2%. Assume that the CAPM holds. What is the…

A: According to CAPM (Capital asset pricing model) ,k =Rf+[ b*(Rm-Rf)]wherek= expected return for the…

Q: Beta and required rate of return A stock has a required return of 11 percent; the risk-free rate is…

A: In the given question we require to compute the beta of stock from below details : Required return =…

Q: A stock has an expected return of 13.87 percent. The beta of the stock is 1.7 and the risk-free rate…

A: Expected Return = r = 13.87%Beta = b = 1.7Risk free rate = rf = 5%Market Risk Premium = mrp = ?

Q: A stock has a required return of 13%; the risk-free rate is 3%, and the market risk premium is 4%.…

A: In the given question we are require to calculate the Beta of stock We can calculate the Beta of…

Q: A stock has an expected return of 7.8 percent. The expected return on the market is 9 percent and…

A: Beta less than 1 signifies less systematic risk.

Q: A stock has a beta of 1.38. The risk free rate is 0.817% and the market risk premium is 5%. What is…

A: Solution:- Capital Asset Pricing Model (CAPM) is the model which helps to compute the fair return on…

Q: The risk-free rate is 3.7 percent and the expected return on the market is 12.3 percent. Stock A has…

A: If expected return is more than required return then security is undervalued.If required return is…

Q: A stock has a beta of 1.16, the expected return on the market is 11 percent, and the risk-free rate…

A: To calculate the expected return on this stock we will use the below formula   Expected return =…

Q: Assume that the risk-free rate is 3% and the expected return on the market is 11%. What is the…

A: In the given question we are require to calculate the required rate of return on a stock. We can…

Q: Assume that the risk-free rate is 4% and the required return on the market is 11%. What is the…

A: Risk free rate = 4% Market return = 11% Beta = 1.39

Q: A stock has a beta of 1.2 and a market risk premium of 10%.  If the risk free rate is 2%, what is…

A: The capital  Assets pricing model is used in order to  calculate the expected return which is…

Q: Assume that the risk-free rate is 7.5% and the required return on the market is 13%. What is the…

A: In the Given Question we require to calculate the required rate of return on a stock using following…

Q: Stock Y has a beta of 0.9 and an expected return of 11.4 percent. Stock Z has a beta of 1.5 and an…

A: Expected return is an important metric in investment analysis, as it helps investors assess the…

Q: A stock has a beta of 1.2. The risk-free rate is 4%. Assume that the CAPM holds. A.  What is the…

A: Beta = 1.2Risk-free rate = 4%Capital Asset Pricing Model holds.

Q: A stock has an expected return of 12.69 percent and its reward-to-risk ratio is 7.6 percent. If the…

A: In this question, we are required to determine the value of beta.

Q: A stock has an expected return of 7.72 percent, the risk-free rate is 2.9 percent, and the market…

A: We can calculate Beta by using the CAPM model as it helps in showing the relationship between the…

Q: Stock A has a beta coefficient = 1.12. calculate the expected rate of return of the stock A given…

A: Solution:- Capital Asset Pricing Model (CAPM) is the model to calculate expected return on a stock.…

Q: A stock has an expected return of 16 percent, its beta is 0.6, and the risk-free rate is 6.4…

A: Given the following information: Expected return on stock (r) = 16% Beta (b) = 0.6 Risk free rate…

Q: The risk-free rate is 5.6%, the market risk premium is 8.5%, and the stock's beta is 2.27. What is…

A: The question can be answered by determining the required rate of return on the stock using the…

Q: For a stock that has a beta of 1.4 and an expected return of 13%, whilst the expected risk premium…

A: Formulas: Expected return = Risk free rate +( Beta*Market risk premium) Expected return = Risk free…

Q: A stock has a beta of 1.68, the expected return on the market is 14.72, and the risk-free rate is…

A: As per CAPM formula Expected return on stock = Risk free return + Beta*(Market return-Risk free…

Q: A stock has a beta of 1.15, the expected return on the market is 11% and risk free rate is 3%. What…

A: According to Capital asset pricing model ( CAPM),Re = Rf +[ beta × ( Rm - Rf)]Where,Re = expected…

Q: What is the required rate of return on a stock with a beta of 1.2, when the risk-free rate is 3.6%…

A: Risk-free rate = 3.6%Market return = 14.4%Beta = 1.2The required rate of return on a stock is a…

Q: The risk-free rate is 6.8 percent, and stock A has an expected return of 15.8 percent. What is the…

A: In order to calculate the beta of  market the  capital Asset pricing models , the three variables…

Q: Suppose that the risk-free rate is 3% and the market risk premium is 8%. According to the CAPM,what…

A: The capital asset pricing model is the tool used to analyze the relationship between the risk and…

Q: A2) The risk-free rate of return is 2.8 percent, the inflation rate is 3.1 percent, and the market…

A: Answer  Formula for  Expected Return : ER  ER  = Rf + beta ( Rm - Rf )

Q: You are trying to figure out the risk-free rate estimate.  Here is information about a stock's CAPM…

A: As per the CAPM model return can be calculated as under. Stock Return = Risk free Return + (Return…

Q: A stock has a beta of 1.5 and an expected return of 16.35%. What is the risk-free rate if the market…

A: We will use and apply the CAPM model here. CAPM stands for Capital Asset Pricing Model. This model…

Q: A stock has an expected return of 12.25 percent.  The beta of the stock is 1.15 and the risk-free…

A: The market risk premium can be calculated with the help of CAPM equation