EXL's stock has a Beta of 1.6 and an Expected Return of 20%. The risk-free rate is equal to 4.0%. What will be the expected return for stock PTHN if its Beta is equal to 0.8? a. 10.00% b. 12.0% 8.00% C. d. We cannot calculate PTHN's return without knowing the expected market return

EXL's stock has a Beta of 1.6 and an Expected Return of 20%. The risk-free rate is equal to 4.0%. What will be the expected return for stock PTHN if its Beta is equal to 0.8? a. 10.00% b. 12.0% 8.00% C. d. We cannot calculate PTHN's return without knowing the expected market return

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Question

EXL's stock has a Beta of 1.6 and an Expected Return of 20%. The risk-free rate is equal to 4.0%. What will be the expected
return for stock PTHN if its Beta is equal to 0.8?
a. 10.00%
b. 12.0%
c. 8.00%
d. We cannot calculate PTHN's return without knowing the expected market return

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