NUMBER 1

Firm A has a beta of 1.87 and its required return is 14.36%. Firm B has a beta of 1 21 If the risk-free rate is 396, what is the required return on firm B? O 11.57% O 12.17% 10.35% 10.96% O 9.74% (tj A certain non-callable bond has 25 years to maturity, a 10% annual coupon, and a SI,000 par value. Your required return on this bond is 12%; if you buy it, you plan to hold it for 6 years. You have expectations that in 6 years, the yield to maturity on a 19-year bond with similar risk will be 7%. How much should you be willing to pay for this bond today? $987.36 $1096.14 $863.47 $1158.36 $1074.86