Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Beta If the expected return of a stock is 6.7, the risk-free rate is 1.57, and the market risk premium is 5.5, what must be

Beta

If the expected return of a stock is 6.7, the risk-free rate is 1.57, and the market risk premium is 5.5, what must be the beta of the stock? (Answer to 2 decimal places).

Using CAPM and the Fisher Approximation, calculate the expected return for a stock given that expected inflation is 2.7%, expected real rates 2.1%, beta of 1.7, and a market risk premium of 5.8%. (Answer to 2 decimal places, 2.45 for 2.45%).

If the market risk premium is 4.2%, the risk-free rate is 1.42%, and the stock's beta is 0.81, what is the stock's expected return? (Answer to 2 decimal places, 2.45 for 2.45%).

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered 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

Students also viewed these Finance questions