Round all dollar answers to 2 decimal places and record all interest rate, coupon rate and growth rate answers as a percent rounded to one decimal place 40. If the expected return on the market portfolio (i.e., Rm) is 18%, if the risk-free rate (i.e., Rf) is 8% and if the beta of Homton, Inc. stock is 1.75, what is the equilibrium expected rate of return on Homton’s stock according to the Capital Asset Pricing Model (CAPM)? (Record your answer rounded to 1 decimal place; for example, record 18.29654% as 18.3). 41. If the beta of Braxton, Inc. stock is 1.51, the risk-free rate (Rf) is 3.5%, and the market risk premium is 4.8%, what is the equilibrium expected rate of return on Braxton’s stock according to the Capital Asset Pricing Model (CAPM)? (Record your answer rounded to 1 decimal place; for example, record 18.29654% as 18.3)

Chance Inc's stock has an expected return of 12.25%, a beta of 1.5, and is in equilibrium.  If the nominal risk-free rate is 4.00%, what is the market risk premium?  What is the equity risk premium?

The risk-free rate of return is 3 percent, and the expected return on the market is 7 percent. Stock A has a beta coefficient of 1.3, an earnings and dividend growth rate of 5 percent, and a current dividend of $2.10 a share. Do not round intermediate calculations. Round your answers to the nearest cent.   What should be the market price of the stock?   $     If the current market price of the stock is $91.00, what should you do?   The stock -Select-shouldshould notItem 2 be purchased.   If the expected return on the market rises to 13.1 percent and the other variables remain constant, what will be the value of the stock?   $     If the risk-free return rises to 4.5 percent and the return on the market rises to 13.9 percent, what will be the value of the stock?   $     If the beta coefficient falls to 1.2 and the other variables remain constant, what will be the value of the stock?   $     Explain why the stock’s value changes in c through e.   The increase in…

JaiLai Cos. stock has a beta of 0.6, the current risk-free rate is 6.0 percent, and the expected return on the market is 10 percent.What is JaiLai’s cost of equity? (Round your answer to 2 decimal places.)

The risk-free rate is 4%. Market risk-premium is 8%. Beta of Stock Q is 1.25. What is the expected return on Stock Q as per CAPM equation? 19.00% 12.00% 9.00% 14.00%

The risk-free rate of return is 1 percent, and the expected return on the market is 7.1 percent. Stock A has a beta coefficient of 1.6, an earnings and dividend growth rate of 7 percent, and a current dividend of $1.50 a share. Do not round intermediate calculations. Round your answers to the nearest cent.   What should be the market price of the stock?   $     If the current market price of the stock is $55.00, what should you do?   The stock  be purchased.   If the expected return on the market rises to 12.4 percent and the other variables remain constant, what will be the value of the stock?   $     If the risk-free return rises to 2 percent and the return on the market rises to 13 percent, what will be the value of the stock?   $     If the beta coefficient falls to 1.3 and the other variables remain constant, what will be the value of the stock?   $     Explain why the stock’s value changes in c through e.   The increase in the return on the market  the…

Suppose TRF = 4%, TM = 9%, and b = 1.1. a. What is n, the required rate of return on Stock i? Round your answer to one decimal place. % b. 1. Now suppose rar increases to 5%. The slope of the SML remains constant. How would this affect ry and n? I. ry will increase by 1 percentage point and n will remain the same. II. Both ry and r, will decrease by 1 percentage point. III. Both rm and r, will remain the same.. IV. Both r and r, will increase by 1 percentage point. V. r will remain the same and r, will increase by 1 percentage point. -Select- v 2. Now suppose rar decreases to 3%. The slope of the SML remains constant. How would this affect ry and n? I. TM will decrease by 1 percentage point and n will remain the same. II. rs will remain the same and n will decrease by 1 percentage point. III. Both ry and r, will increase by 1 percentage point. IV. Both ry and r, will remain the same. V. Both ry and r, will decrease by 1 percentage point. Select

Suppose the common stock of United Industries has a beta of 0.83 and an expected return of 8.7 percent. The risk-free rate of return is 3.4 percent while the inflation rate is 2.8 percent. What is the expected market risk premium? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

Pai lnc's stock has an expected return of 16.25%, a beta of 1.39, and is in equilibrium. If the risk-free rate is 2.8%, what is the market risk premium?  A. 10.84% B. 9.68% C. 7.47% D. 11.32% E. 8.29%

The risk-free rate of return is 3 percent, and the expected return on the market is 7 percent. Stock A has a beta coefficient of 1.3, an earnings and dividend growth rate of 5 percent, and a current dividend of $2.10 a share. Do not round intermediate calculations. Round your answers to the nearest cent.   What should be the market price of the stock?   $     If the current market price of the stock is $91.00, what should you do?   The stock -Select-shouldshould notItem 2 be purchased.   If the expected return on the market rises to 13.1 percent and the other variables remain constant, what will be the value of the stock?   $     If the risk-free return rises to 4.5 percent and the return on the market rises to 13.9 percent, what will be the value of the stock?   $     If the beta coefficient falls to 1.2 and the other variables remain constant, what will be the value of the stock?   $     Explain why the stock’s value changes in c through e.   The increase in…