Suppose the risk free rate is 2, 32%, the expected return of the market portfolio is 5, 64% and the beta of stock X-Bros S. A. is 1. 10. What is the expected cost of equity of X-Bros S. A. (in percent)?

Q: Assume that the risk-free rate of return is 4% and the market risk premium (i.e., Rm- R;) is 89%. If…

A: Financial management consists of directing, planning, organizing and controlling of financial…

Q: The current appropriate risk-free rate is 6% and the return on the market is 13.5%.   levered beta…

A: Risk Free Rate = 6% Expected Return on market portfolio = 13.5% Beta = 1.29

Q: Assume that expected return of the stock A in your portfolio is 14.6%. The risk premium on the…

A: CAPM is a financial model which shows the relation between risk and expected return of the…

Q: Assume that the risk-free rate of return is 46 and the market risk premium (Le, Rm-Re) is 8%. If use…

A: Financial management consists of directing, planning, organizing and controlling of financial…

Q: What is the beta of a firm whose equity has an expected return of 21.3 percent when the risk-free…

A: Using CAPM

Q: If the risk free rate is 6 %, the expected return on the market portfolio is 12% and the beta of…

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

Q: Assume that the risk-free rate of return is 4% and the market risk premium (Le., Rm- R:) is 896. If…

A: Financial management consists of directing, planning, organizing and controlling of financial…

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: 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: 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: Suppose your company has an equity beta of 0,9 and the current risk-free rate is 7,1%. if the…

A: We require to calculate cost of equity capital in this question.

Q: Company Q has earnings of $3.00 per share, a market price of $25, and a beta of 1.25. The risk-free…

A: Given the following information: Earnings per share: $3 per share Market price of share: $25 Beta:…

Q: Walmart's beta is 0.7. The market risk premium is 4.2 %. The appropriate risk-free rate is 0.04 %.…

A: Given information: Beta : 0.7 Market risk premium : 4.2% Risk free rate : 0.04%

Q: Assume that you are using the Capital Asset Pricing Model (CAPM) to find the expected return for a…

A: The Capital Asset Pricing Model (CAPM) is a financial model used to estimate the expected return on…

Q: Suppose the market risk premium is 4.0 % and the risk-free interest rate is 3.0%. Use the data below…

A: Given details are : Market risk premium = 4% Risk free rate = 3% Beta = 2.28 From above details we…

Q: a.) Using Capital Asset Pricing Model (CAPM) to compute an appropriate rate of return for Intel…

A: In this question we are required to calculate rate of return of Intel common stock using CAPM: As…

Q: The risk-free rate of return is 3.7 percent and the market risk premium is 6.2 percent. What is the…

A: The given question can be solved using capital asset pricing model (CAPM)

Q: Consider the following information for Vine Inc.: Beta: 1.39 Risk-free rate: 7% Market Risk Premium:…

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

Q: The risk-free rate is 2% and the expected return on a market portfolio is 6%. If a share has a beta…

A: As per CAPM Ri = Rf + B (Rm - Rf) Where Ri = Return on equity Rf = Risk free rate of return B = Beta…

Q: An analyst gathers the following data: * Expected (estimated) rate of return on the market = 15% *…

A: Expected (estimated) rate of return on the market = Rm =15%Risk Free Rate = Rf = 8%Expected…

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: Walmart's beta is 0.7. The market risk premium is 4.2 %. The appropriate risk-free rate is 0.04 %.…

A: Given information: Beta : 0.7 Market risk premium : 4.2% Risk free rate : 0.04%

Q: 1.The risk-free rate of return is 2.6 percent and the market risk premium is 10 percent. What is the…

A: We need to find out the expected return of the stock by using Capital Asset Pricing Model (CAPM).…

Q: The risk-free rate of return is 3.75 percent and the market risk premium is 6.5 percent. What is the…

A: Risk free rate of return = rf = 3.75% Market risk premium = mrp = 6.5% Beta = b = 0.84

Q: iven the information below, calculate the reward-to-risk ratio implied by the CAPM pricing model.

A: The risk-reward ratio determines how much reward is there for risk of  every dollar.

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: Suppose the market portfolio has an expected return of 9% and a volatility of 18.5%. YMH stock…

A: Sharpe ratio shows the risk adjusted performance of the stock based on risk free rate and volatility…

Q: Suppose your company has an equity beta of .62 and the current risk-free rate is 4.1%. If the…

A: Equity capital refers to funds raised by a firm by diluting its equity or ownership. With issue of…

Q: The current appropriate risk-free rate is 6% and the return on the market is 13.5%.Further assume…

A: CAPM model is used to calculate required rate of return on equity or the cost of equity. It is…

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: 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: A stock has an expected return of 13.1%, its beta is 1.70, and the risk free premium rate is 2.6%.…

A: In the given question we require to calculate the expected return on market from the following…