Question
I NEED BOTH QUESTIONS ANSWERED PLEASE. (round final answers to the nearest 4 decimal places) 1) An analyst gathered the following information for a stock
I NEED BOTH QUESTIONS ANSWERED PLEASE. (round final answers to the nearest 4 decimal places)
1) An analyst gathered the following information for a stock and market parameters: stock beta=0.70; expected return on the market = 10.20%; expected return on T-bills=1%; current stock price= $9.23; expected stock price in one year= $10.79; expected dividend payment next year=$3.54. Calculate the: a) required amount for this stock b) expected return for this stock
2) the market risk premium for next period is 9.20% and the risk-free rate is 2.20%. Stock Z has a beta of 0.73 and an expected return of 9.90%. What is the: a) market's reward-to-risk ratio? b) stock Z's reward-to-risk ratio?
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