Assume that the risk-free rate is 6.5% and the required return on the market is 10%. What is the required rate of return on a stock with a beta of 3? Round your answer to two decimal places.   %

Q: A stock has a required return of 12%, the risk-free rate is 2.5%, and the market risk premium is 5%.…

A: The Capital Asset Pricing Model (CAPM) is a model that describes the relationship between the…

Q: 8.4   Assume that the risk-free rate is 3% and the market risk premium is 4%. What is the…

A: Required Rate is the least return that is anticipated by an investor on any security. It is…

Q: A stock has an expected return of 12.4%, the risk-free rate is 6.5%, and the market risk premium is…

A: In the given problem we require to calculate the Beta of the stock using following details: Expected…

Q: The current risk-free rate of return, rRF, is 4 percent and the market risk premium, RPM, is 8…

A: The formula to calculate the required rate of return using CAPM is as follows:Return = Riskfree rate…

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: The risk-free rate is 4%. The market risk-premium is 7%. The beta is 2.0. What is the expected rate…

A: Financial statements are statements which states the business activities performed by the company .…

Q: Suppose Peloton company's stock has a beta of 0.89 and a required rate of return for the stock is…

A: The risk-free rate, which is sometimes represented as the yield on government bonds, is the…

Q: A stock has a beta of 1.15, the expected return on the market is 10.5%, and the risk - free rate is…

A: The expected return on the stock is calculated using the following equation

Q: Johnson Corporation stock has a beta of 0.74. What is its expected return?

A: As per the Capital Asset pricing model expected return can be calculated using the formula given…

Q: Suppose the risk-free return is 4.1% and the market portfolio has an expected return of 9.3% and a…

A: In CAPM; Capital Asset Pricing Model, the expected return for a single stock is ascertained by…

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: Suppose the CAPM holds. The risk-free rate is 2%, and the expected return of the market portfolio is…

A: As per CAPME(ri) = Rf  + Bi * (E(Rm) - Rf)E(ri) = Expected returnRf = Risk free rateBi = BetaE(Rm) =…

Q: A stock has a required return of 13%, the risk-free rate is 3%, and the market risk premium is 6%.…

A: Beta means the measure of changes in the stock in connection with the entire market.  Beta is…

Q: Suppose the risk-free return is 4.2% and the market portfolio has an expected return of 11.4% and a…

A: Expected return = Risk free rate + beta * (market return -risk free rate )

Q: A stock has a beta of 1.61, the expected return on the market is 0.07, and the risk-free rate is…

A: Return on stock :— It is the rate of return expected by the investors of stock.    According to CAPM…

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

A: As per CAPM, Required Rate of return = Risk free rate + (Beta * Market risk premium) Market risk…

Q: A stock has an expected return of 0.11, its beta is 1.22, and the risk-free rate is 0.03. What must…

A: It has been provided: Beta = 1.22 Expected return = 0.11 Risk-free rate = 0.03 Required: Expected…

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: Suppose the risk-free return is 6.3% and the market portfolio has an expected return of 11.5% and a…

A: The objective of the question is to calculate the expected return of Johnson & Johnson…

Q: Assume that the risk-free rate is 3.6% and the market risk premium is 4%. What is the required rate…

A: Risk-Free Rate = 3.6%Market Risk Premium = 4%Beta = 1.4

Q: Assume that the risk-free rate is 4% and the expected return on the market is 11.5%. What is the…

A: The Capital Asset Pricing Model (CAPM) is a tool used in finance to estimate the cost of equity,…

Q: Stock A: Beta is 1.30, the require return in 12.00% Stock B: Beta 0.80. If the risk free is 4.75%.…

A: To solve the question, first we need to determine the market return and then use it to determine the…

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: Stock R has a beta of 1.5, Stock S has a beta of 0.85, the required return on an average stock is…

A: Investors want to be compensated for risk and time worth of money. The risk-free rate in the CAPM…

Q: Assume that the risk-free rate is 6% and the required return on the market is 10%. What is the…

A: The formula used as follows: Required rate of return=rRF+Beta rM-rF

Q: A stock has an expected return of 15.9 percent and a beta of 1.70, and the expected return on the…

A: The Capital Asset Pricing Model (CAPM) refers to the model which tells us how the financial markets…

Q: What is the required return on an investment with a beta of 1.4 if the risk-free rate is 2.2 percent…

A: Formula:- Required return = Risk free rate + beta*(market rate- risk free rate)

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: A stock has an expected return of 11 percent, its beta is 95, and the risk-free rate is 6 percent.…

A: We need to use CAPM to calculate expected rate of return. The equation is Ri=Rf + Beta(Rm-Rf) Where…

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 16.4%, its beta is 1.3, and the expected return on the market is…

A: Following details are given to us in the question: Expected return of stock = 16.4% Beta = 1.3…

Q: Suppose rRF = 6%, rM = 11%, and rA = 10%.   Calculate Stock A's beta. Round your answer to one…

A: Required rate of return on stock = risk free rate  +(beta) * (market return - risk free rate)

Q: A stock has a required return of 9%; the risk- free rate is 4%; and the market risk premium is 3%.…

A: In the given question we are require to calculate the Beta: We can calculate the Beta using Capital…

Q: JaiLai Cos. stock has a beta of 0.9, the current risk-free rate is 6.5 percent, and the expected…

A: Cost of Equity: It is the rate of return which is the least satisfactory return an investor may…

Q: Stock R has an expected rate of return of 9.5%, stock S has a beta of 1.2, the expected rate of…

A: In the given question we require to compute the beta of stock R and expected rate of return for…

Q: Stock R has a beta of 2.0, Stock S has a beta of 0.75, the required return on an average stock is…

A: Given, The Beta of Stock R is 2 The beta of stock S is 0.75 Average stock return is 14% Risk free…

Q: A stock has an expected return of 0.15, its beta is 0.52, and the expected return on the market is…

A: Expected return = 0.15 Beta = 0.52 Market return = 0.08

Q: A stock has a required return of 7%; the risk- free rate is 3.0%; and the market risk premium is 3%.…

A: Following details are given in the question : Required return on stock = 7% Risk free rate = 3%…

Q: Assume that the risk-free rate is 7.7% and the market return is 10%. Calculate the expected rate of…

A: The required return is calculated using the CAPM model capital asset pricing model according to…

Q: What must be the beta of a portfolio with E(rp) = 14.5%, if rf = 4% and E(TM) = 10%? (0 Round your…

A: Solution:-Capital Asset Pricing Model (CAPM) is a model which gives a formula to calculate the…

Q: A stock has a beta of 1.08, the expected return on the market is 0.09, and the risk-free rate is…

A: Here, Beta = 1.08 Expected return on the market = 0.09 Risk-free rate = 0.06 To Find: Expected…

Q: A stock has an expected return of 7.5%. Given a risk-free rate of 4.4% and a market return of 7%,…

A: The calculation of Beta, which is the measure of risk in the business. When we are using the capital…

Q: Stock R has a beta of 2.5, Stock S has a beta of 0.65, the required return on an average stock is…

A: The Beta of Stock R is 2.5 The beta of stock S is 0.65 Average stock return is 14% Risk free rate is…

Q: Consider the CAPM. The risk-free rate is 6%, and the expected return on the market is 18%. What is…

A: In the given question we need to calculate the expected return on a stock using CAPM i.e. Capital…