4. All else equal, which of the following statements is CORRECT? A. The companys value decreases as Beta declines. B. The companys value increases as Beta declines. C. The companys value is unaffected by changes in the Beta. D. The companys value increases as the Beta increases.

5. An analyst has collected the following information: - The risk-free rate is 5.5 percent. - The market risk premium is 5 percent. - The stocks beta is 1.4. What is the companys cost of equity? A. 7.7% B. 12.5% C. 15.3% D. 17.1%

6. The estimated beta for RDG is 0.74. The risk free rate of return is 4 percent and the Equity Risk Rremium is 5 percent. What is the required rate of return for RDG using the CAPM? A. 15.2% B. 12.3% C. 10.1% D. 7.7%