Question
25.If the market premium is 10.64 percent, the risk-free rate is 5.27 percent, the inflation rate is 2.38 percent, and Middlefield Motors common stock has
25.If the market premium is 10.64 percent, the risk-free rate is 5.27 percent, the inflation rate is 2.38 percent, and Middlefield Motors common stock has a beta of 0.63, then what is the expected return for Middlefield Motors stock? Answer as a rate in decimal format so that 12.34% would be entered as .1234 and 0.98% would be entered as .0098.
26.If the expected return on the market is 13.2 percent, inflation is 2.86 percent, the market premium is 8.29 percent, and Oxygen Optimization common stock has a beta of 0.52, then what is the expected return for Oxygen Optimization stock? Answer as a rate in decimal format so that 12.34% would be entered as .1234 and 0.98% would be entered as .0098.
Only answer should be fine! Thank you:)
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