Question
Levine Manufacturing Inc. is considering several investments: SECURITY BETA A 1.58 B 0.85 C 0.62 D 1.26 The rate on Treasury bills is currently 6.5
Levine Manufacturing Inc. is considering several investments:
SECURITY | BETA |
A | 1.58 |
B | 0.85 |
C | 0.62 |
D | 1.26 |
The rate on Treasury bills is currently 6.5 percent, and the expected return for the market is 13.5 percent. What should be the required rate of return for each investment (using the CAPM)?
a. Using the CAPM, the required rate of return for security A is ___ % (Assume % and round to two decimal places.)
b. Using the CAPM, the required rate of return for security B is ___% (Assume % and round to two decimal places.)
c. Using the CAPM, the required rate of return for security C is ___ % (Assume % and round to two decimal places.)
d. Using the CAPM, the required rate of return for security D is ___ % (Assume % and round to two decimal places.)
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