FREE Trial
Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

a. Compute a fair rate of retum for Intel common stock, which has a 1.5 beta. The risk-free rate is 8 percent, and the market

image text in transcribed
a. Compute a fair rate of retum for Intel common stock, which has a 1.5 beta. The risk-free rate is 8 percent, and the market portfolio (New York Stock Exchange stocks) has an expected return of 12 percent. b. Why is the rate you computed a fair rate? a. Using the CAPM, the fair rate of return for Intel common stock is \%. (Round to two decimal places.)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Finance And Security Global Vulnerabilities Threats And Responses

Finance And Security Global Vulnerabilities Threats And Responses

Authors: Martin S. Navias

1st Edition

1787381366, 978-1787381360

More Books

Students also viewed these Finance questions

Question

★★★★★
Assume that Lee Inc. has the following accounts at the end of the current year: 1. Common Shares 2. Raw Materials Inventory 3. FV-OCI Investments 4. Unearned Rent Revenue 5. Work-in-Process Inventory...

Answered: 1 week ago

Question

★★★★★
10. It has been proposed that natural monopolists should be allowed to determine their profit-maximizing outputs and prices and then government should tax their profits away and distribute them to...

Answered: 1 week ago

Question

★★★★★
a. Write vector E in component form. b. Draw a coordinate system and on it show vectors c. What are the magnitude and direction of vector Let

Answered: 1 week ago

Question

★★★★★
Assess your utility function in three different ways. a. Use the certainty-equivalent approach to assess your utility function for wealth over a range of $100 to $20,000. b. Use the...

Answered: 1 week ago

Question

★★★★★
a. Compute a fair rate of retum for Intel common stock, which has a 1.5 beta. The risk-free rate is 8 percent, and the market portfolio (New York Stock Exchange stocks) has an expected return of 12...

Answered: 1 week ago

Question

★★★★★
3 The following data from the just completed year are taken from the accounting records of Mason Company: 1.25 points Sales Direct labor cost Raw material purchases Selling expenses Administrative...

Answered: 1 week ago

Question

★★★★★
Cheyenne Vision Inc. opened for business on Jan 1, and uses a perpetual inventory system. During January, the company had the following purchases and sales for one of its products: Purchases Sales...

Answered: 1 week ago

Question

★★★★★
A cube with edge length L = 0.25 m and density Q = 0.88103 kg/m floats in equilibrium in a liquid of density = 15103 kg/m3, with the top of the cube a distance d above the liquid's surface, as shown...

Answered: 1 week ago

Question

★★★★★
Hill Corp. had 600,000 shares of common stock outstanding on January 1, issued 900,000 shares on July 1, and had income applicable to common stock of $1,050,000 for the year ending December 31, 2010....

Answered: 1 week ago

Question

★★★★★
7.1 A mammography center performs eleven different procedures. The volume of each procedure during an eight-month period and the standard hours per procedure are shown in Table EX 7.1. Table EX 7.1...

Answered: 1 week ago

Question

★★★★★
Graff, Incorporated, has sales of $49,800, costs of $23,700,depreciation expense of $2,300, and interest expense of $1,800. Thetax rate is 22 percent. What is the operating cash flow, or OCF?Note:...

Answered: 1 week ago

Question

★★★★★
2. What are the major capabilities of database management systems (DBMS) and why is a relational DBMS so powerful?

Answered: 1 week ago

Question

★★★★★
4. Describe the changes in the business as a result of adopting HANA. Automotive Resources International, better known as simply ARI, is the worlds largest privately-held company for vehicle fleet...

Answered: 1 week ago

Question

★★★★★
3. Why was the participation of business users so important? If they didnt play this role, what would have happened? American Water, founded in 1886, is the largest public water utility in the United...

Answered: 1 week ago

Previous Question Next Question