Answered step by step

Verified Expert Solution

Link Copied!

Question

1 Approved Answer

Posted on Jul 14, 2024

Both questions 8 & 9 please! More of just looking for an exolanation to why the answer is what it is! 8 XYZ common stock

Both questions 8 & 9 please! More of just looking for an exolanation to why the answer is what it is!
8 XYZ common stock has a beta of 1.25. The expected return on the market is 13% and the risk-free rate is 3%. Based on the CAPM, and making use of the information, what is the required return on XYZ common stock? (Answer in decimals rounding to the nearest 0.001) 9 ABC common stock has a beta of 1.2. The expected return on the market is 9% and the risk-free rate is 2%. Based on the CAPM, and making use of the information, what is the required minimum return on ABC stock? (Answer in decimals rounding to the nearest 0.001)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

Get Instant Access with AI-Powered Solutions

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

Step: 2

Step: 3

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

Intermediate Accounting Volume 1

Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Irene M. Wiecek, Bruce J. McConomy

12th Canadian edition

119-49633-5, 1119496497, 1119496330, 978-1119496496

Students also viewed these Finance questions

Question

In general, why is it important for clinical psychologists to be culturally competent when working with members of this culture?

Answered: 1 week ago

Question

★★★★★

Sequence the jobs shown below by using a Gantt chart. Assume that the move time between machines is one hour. Sequence the jobs in priority order 1, 2, 3, 4. a. What is the makespan? b. How much...

Answered: 1 week ago

Question

★★★★★

Suppose that LMN stock currently is selling at $72 per share. You buy 400 shares using $22,000 of your own money, borrowing the remainder of the purchase price from your broker. The rate on the...

Answered: 1 week ago

Question

★★★★★

A national park will build at a cost of $2.8 billion with annual salaries and maintenance cost of $500,000 per year. Saving to environment is $273 million.Cost income is estimated to be $4 million at...

Answered: 1 week ago

Question

★★★★★

Assume the taxpayer does NOT wish to contribute to the Presidential Election Fund, unless otherwise stated in the problem. Assume all taxpayers did NOT receive, sell, send, exchange, or otherwise...

Answered: 1 week ago

Question

★★★★★

1.You decided to sell Treasury bill futures contracts with a quoted price was 92-50. When you close this position, the quoted price was 91-75. Determine the profit or loss per contract, ignoring...

Answered: 1 week ago

Question

★★★★★

DBC, TDABC, and ABC The Bienestar Cardiology Clinic has two major activities: diagnostic and treatment. The two activities use four resources: nursing, medical technicians, cardiologists, and...

Answered: 1 week ago

Question

★★★★★

Exercise 4-1 (Algo) Computing revenues, expenses, and income LO C1 Fill in the blanks in the following separate income statements a through e. Sales Cost of goods sold Merchandise inventory,...

Answered: 1 week ago

Question

★★★★★

b 4th Quarter Garden Depot is a retailer that is preparing its budget for the upcoming fiscal year. Management has prepared the following summary of its budgeted cash flows: 1st Quarter 2nd Quarter...

Answered: 1 week ago

Previous Question Next Question