Question
Centex Energy has a beta of 1.35. Assume that risk-free rate and the expected rate of return on the market are 2% and 12%
Centex Energy has a beta of 1.35. Assume that risk-free rate and the expected rate of return on the market are 2% and 12% respectively. According to the capital asset pricing model (CAPM), what is the expected rate of return for this company's stock? Your answer should be between 11.45 and 18.55, rounded to 2 decimal places, with no special characters.
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Corporate Finance A Focused Approach
Authors: Michael C. Ehrhardt, Eugene F. Brigham
6th edition
1305637100, 978-1305637108
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