Question
CAPM and required return. Calculate the required rate of return for Manning Enterprises assuming that investors expect a 4.6% rate of inflation in the future.
CAPM and required return.
Calculate the required rate of return for Manning Enterprises assuming that investors expect a 4.6% rate of inflation in the future. The real risk-free rate is 1.5% and the market risk premium is 4%. Manning has a beta of 1.5 and its realized rate of return has averaged 8% over the last 5 years.
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Foundations of Financial Management
Authors: Stanley Block, Geoffrey Hirt, Bartley Danielsen
14th edition
007745443X, 978-0073530727, 73530727, 978-0077454432
