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please help me with both!! thank you Nagel Equipment has a beta of 0.72 and an expected dividend growth rate of 3-50% per year. The
please help me with both!! thank you
Nagel Equipment has a beta of 0.72 and an expected dividend growth rate of 3-50% per year. The T-bill rate is 4.00%, and the T-bond rate is 5.40%. The annual return on the stock market during the past 4 years was 10.25%. Investors expect the average annual future return on the market to be 14.65%. Using the SML, what is the firm's required rate of return? Do not round your intermediate calculations. O a. 10.559 O b. 12.06% O c. 11.67% O d. 15.56% O e. 8.899 Company A has a beta of 0.60, while Company B's beta is 1.70. The required return on the stock market is 9.00%, and the risk-free rate is 2.25%. What is the difference between A's and B's required rates of return? (Hint: First find the market risk premium, then find the required returns on the stocks.) Do not round your intermediate calculations. O a. 7.425% O b. 6.300% O c. 10.01396 O d. 9.900% O e. 4.950%Step by Step Solution
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