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Stock A's stock has a beta of 1.30, and its required return is 15.25%. Stock B's beta is 0.80. If the risk-free rate is 4.75%,
Stock A's stock has a beta of 1.30, and its required return is 15.25%. Stock B's beta is 0.80. If the risk-free rate is 4.75%, what is the required rate of return on B's stock? (Hint:First find the market risk premium.)
Select the correct answer.
a. 11.11%
b. 11.16%
c. 11.21%
d. 11.26%
e. 11.31%
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