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HELP ME! PLEASE! 8-5) A stock has a required return of 12%; the risk-free rate is 5%; and the market risk premium is 3%. a.

HELP ME! PLEASE!

8-5) A stock has a required return of 12%; the risk-free rate is 5%; and the market risk premium is 3%.

a. What is the stock's beta? Round your answer to two decimal places. 2.33 (correct)

b. New stock's required rate of return will be %. Round your answer to two decimal places.

8-7) Suppose you are the money manager of a $4.54 million investment fund. The fund consists of 4 stocks with the following investments and betas:

Stock Investment Beta
A $ 300,000 1.50
B 460,000 - 0.50
C 1,180,000 1.25
D 2,600,000 0.75

If the market's required rate of return is 10% and the risk-free rate is 4%, what is the fund's required rate of return?

1B) Potter Industries has a bond issue outstanding with an annual coupon of 6% and a 10-year maturity. The par value of the bond is $1,000. If the going annual interest rate is 7%, what is the value of the bond? Round your answer to the nearest cent. Do not round intermediate calculations. $

Quantitative Problem: Potter Industries has a bond issue outstanding with a 6% coupon rate with semiannual payments of $30, and a 10-year maturity. The par value of the bond is $1,000. If the going annual interest rate is 7%, what is the value of the bond? Round your answer to the nearest cent. Do not round intermediate calculations. $

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