Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

A stock has an expected return of 0.08, its beta is 1.86, and the expected return on the market is 0.09. What must the risk-free

A stock has an expected return of 0.08, its beta is 1.86, and the expected return on the market is 0.09. What must the risk-free rate be? (Hint: Use CAPM) Enter the answer in 4 decimals e.g. 0.0123.

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

International Finance Transactions Policy And Regulation

Authors: Hal Scott, Anna Gelpern

20th Edition

1609303164, 978-1609303167

More Books

Students also viewed these Finance questions

Question

How do you try to manipulate your unique smell?

Answered: 1 week ago