Consolidated Industries has a beta of 1.34. Assuming the risk-free rate is 5.75 percent, and the required return on the market is 12.5 percent, What is the required return on the stock?

Q: Crane Industries, common stock has a beta of 1.5. If the current risk-free rate is 3.6 percent and…

A: The cost of common stock is the cost of issuing the equity capital of the company. The cost of…

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: Amalgamated Consolidated has a beta of 2.05. Assuming a risk free rate of 3.45% and a market risk…

A: CAPM is the method of calculating the expected return on investment. The expected return is the…

Q: The expected return for a stock, calculated using the CAPM is 13.5%. The risk free rate is 7.5% and…

A: In the given problem we are required to calculate the implied return on market using following…

Q: Zacher Co.'s stock has a beta of 0.90, the risk-free rate is 4.25%, and the market risk premium is…

A: Beta = b = 0.90  Risk free rate = rf = 4.25% Market risk premium = mrp = 5.50%

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: Moerdyk Company's stock has a beta of 1.5, the risk - free rate (rRFR) is 4%, and the market risk…

A: The objective of the question is to calculate the required rate of return for Moerdyk Company's…

Q: The risk free rate currently have a return of 2.5% and the market risk premium is 4.22%. If a firm…

A: Cost of equity refers to the net cost that a business entity bears by raising the capital from the…

Q: Zacher Co.'s stock has a beta of 0.82, the risk-free rate is 4.25%, and the market risk premium is…

A: Required rate of return = Risk free rate + beta * market risk premium

Q: jerilu markets has a beta of 1.23 the risk free rate of return is 2.10 percent and the market rate…

A: Step 1 The investment return that an asset is anticipated to generate over and above the risk-free…

Q: Steady Company's stock has a beta of 0.24. If the risk-free rate is 6.1% and the market risk premium…

A: Solution:- Company’s cost of equity means the minimum rate of return required by the equity…

Q: The stock in Bowie Enterprises has a beta of 1.10. The expected return on the market is 12.40…

A: Beta of stock = 1.10 Market return = 12.40% Risk free rate = 3.21%

Q: Vani Corporation's beta coefficient is equal to 0.7 and the required rate of return on the stock…

A: CAPM is used to determine expected return by an investor considering systematic risk and risk-free…

Q: Suppose the risk-free rate is 8%. The expected return on the market is 16%. If a particular stock…

A: Capital Asset Pricing Model: This model explains the relationship between the expected return and…

Q: Assume the following information about the market and Lithium Motors Stock.​ Lithium's beta​ = 1.80,…

A: Beta (b) = 1.80 Risk free rate (Rf) = 0.025 Market risk premium (Mp) = 0.08 Expected return = ?…

Q: JaiLai Cos. stock has a beta of 0.8, the current risk-free rate is 6.2 percent, and the expected…

A: The provided information are: Beta = 0.80 Expected return = 12% Risk free rate = 6.2%

Q: Alpha Company has a beta of 3.25 and a standard deviation of returns of 27%. The return on the…

A: In this question we require to calculate the risk premium on the market and also required rate of…

Q: The market risk premium is 11.5 percent, and the risk-free rate of return is 3.75 percent. Assuming…

A: Market risk premium = mrp = 11.5% Risk free rate of return = rf = 3.75% Expected return = R = 13.5%

Q: Cooley Company's stock has a beta of 0.8 , the risk-free rate is 1.04 %, and the market risk premium…

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

Q: The stock of Wiley United has a beta of 0.92. The market risk premium is 8.6% and the risk-free rate…

A: Given the following information: Beta: 0.92 Market risk premium: 8.6% Risk free rate: 2.2%

Q: The expected return on Share X is 15.75% while the risk-free rate of return is 7%. If the expected…

A: Expected return =Rf + beta * ( Rm- Rf) Rf = Risk free rate Rm =Expected return on market

Q: Cooley Computer Repair and Service Company's stock has a beta of 1.28, the risk-free rate is 2.25%,…

A: According to capm approach required return is equal to risk free rate plus beta times market risk…

Q: Suppose the common stock of United Industries has a beta of 1.18 and an expected return of 11.9…

A: Market risk premium= Rm-Rfwhere,Rm= market returnRf= Risk-free rate

Q: A firm's stock has a beta of 1.7. The expected T-bill return is 3.7%. and the expected market return…

A: Risk-free rate(expected T-bill return) = 3.7%Beta = 1.7Expected market return = 7%

Q: The risk-free rate of return is 2.5%, the required rate of return on the market is 11.5%, and ABC…

A: The Capital Asset Pricing Model (CAPM) is the model which shows the relationship between the…

Q: The risk-free rate of return is 2 percent, and the expected return on the market is 6.1 percent.…

A: Value of stock can be determined based on the dividend and growth of dividend and required rate of…

Q: The risk-free rate of return is currently 0.03, whereas the market risk premium is 0.04. If the beta…

A: Following details are given in the question: Risk free rate of return = 0.03 = 3% Market Risk…

Q: The expected rate of return on a market portfolio is 7 percent. The riskless rate of interest is 4…

A: required rate of return = risk free rate + beta * (market return less risk free rate)

Q: If the expected return from the market is 18%, the risk-free rate is 11%, and the beta of Loschert…

A: The term beta of a stock represents the responsiveness of a particular stock in relation to the…

Q: The risk-free rate is 1.45% and the market risk premium is 5.21%. According to the Capital Asset…

A: Capital assets pricing model gives the expected rate of return from the stock based on the risk…

Q: JaiLai Cos. stock has a beta of 0.7, the current risk-free rate is 6.1 percent, and the expected…

A: CAPM model provides formula that calculates the expected return on stock based on its level of risk.…

Q: Porter's Inc.'s stock has an expexted return of 12.5%, a beta of 1.25, and is in equilibrium. If the…

A: Following details are given in the question for Porter's Inc Stock: Expected Return = 12.5% Beta =…

Q: Spider Corp has a beta of 1.7. The risk-free rate is 1.6% and the market risk premium is 5.2% .(Note…

A: Following details are given in the question regarding Spider Corp: Beta = 1.7 Risk free rate = 1.6%…

Q: Suppose the risk-free return is 5.3% and the market portfolio has an expected return of 10.2% and a…

A: We need to use CAPM model to calculate expected rate of return. Expected return =Risk free…

Q: Diddy corp. has a beta of 1.3. The current risk-free rate is 3 percent and the expected return on…

A: Following details are given in the question for Diddy corp. : Beta of Stock = 1.3 Risk free rate =…

Q: Consolidated Industries has a required return of 17.5 percent. The return on the market is 9 percent…

A: Given the following:  Required Return = 17.5%  Market Return = 9%  Risk Free Rate = 2%

Q: a) Astock has expected return of 10% and a beta of 0.70. Assume the risk - free rate is 5.5% . what…

A: Required rate is the expected rate from stock by investors based on the risk involved on the stock…

Q: A company's stock has a beta of 1.20, the risk-free rate is 1.6%, and the market risk premium is…

A: We will have to apply the CAPM model here. CAPM is the capital asset pricing model.

Q: he risk-free rate of return is 1 percent, and the expected return on the market is 8.7 percent.…

A: Shares are valued using a method called the dividend discount model. This model is based on the…

Q: B24&Co stock has a beta of 1.66, the current risk-free rate is 3.16 percent, and the expected return…

A: Here, Risk Free Rate is 3.16% Beta is 1.66 Expected Return on the Market is 10.66%

Q: Cooley Company's stock has a beta of 1.05, the risk-free rate is 2%, and the market risk premium is…

A: Required rate of return = CAPM = Risk free rate  + Market risk premium * beta

Q: nvestors require a return of 14.15 percent on Industrial Industries stock and require a return of…

A: The required rate of return can be ascertained by using the Capital Asset Pricing Model (CAPM). The…

Q: Centex Energy has a beta of 1.47. Assume that risk-free rate and the expected rate of return on the…

A: CAPM capital assets pricing model gives the required rate of return based on the risk involved in…