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I have done a sectio of this question. can you please help me with b and c sections? thanks Required Rate of Return As an
I have done a sectio of this question. can you please help me with b and c sections? thanks
Required Rate of Return As an equity analyst you are concerned with what will happen to the required return to Universal Toddler' stock as market conditions change. Suppose rrF = 5%, M = 13%, and but = 2.1. a. Under current conditions, what is rut, the required rate of return on UT Stock? Round your answer to two decimal places. 21.8 % b. 1. Now suppose rrf increases to 6%. The slope of the SML remains constant. How would this affect rm and NUT? I. Both rm and run will remain the same. II. Both rm and run will increase by 1%. III. r will remain the same and rut will increase by 1%. IV. M will increase by 1% and run will remain the same. V. Both rm and nut will decrease by 1%. -Select- 2. Now suppose rre decreases to 4%. The slope of the SML remains constant. How would this affect rm and TUT? I. Both rand rut will remain the same. II. Both rm and run will decrease by 1%. III. will decrease by 1% and run will remain the same. IV. r will remain the same and run will decrease by 1%. V. Both rm and run will increase by 1%. -Select- C. 1. Now assume rre remains at 5% but r increases to 15%. The slope of the SML does not remain constant. How would these changes affect RUT? I. TUT will decrease by 4.2%. II. Ut will remain the same. III. Ut will increase by 4.2%. -Select- 2. Now assume tre remains at 5% but im falls to 12%. The slope of the SML does not remain constant. How would these changes affect TUT? I. Put will increase by 2.1%. II. Ut will remain the same. III. CUT will decrease by 2.1%. -Select- C. -Select- 2. Now suppose rre decreases to 4%. The slope of the SML remains constant. How would this affect rand RUT? I. Both rm and run will remain the same. II. Both rm and rur will decrease by 1%. III. TM will decrease by 1% and run will remain the same. IV. M will remain the same and run will decrease by 1%. V. Both rm and nut will increase by 1%. -Select- 1. Now assume ref remains at 5% but rm increases to 15%. The slope of the SML does not remain constant. How would these changes affect rut? 1. rut will decrease by 4.2%. II. Cut will remain the same. III. PUT will increase by 4.2%. -Select- 2. Now assume rre remains at 5% but r falls to 12%. The slope of the SML does not remain constant. How would these changes affect rut? I. Cut will increase by 2.1%. II. rut will remain the same. III. Ut will decrease by 2.1%. -Select
I have done a sectio of this question. can you please help me with b and c sections?
thanks
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