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Problem #2 (5 Marks) At the beginning of 2020, TVR's beta was 1.4 and the risk-free rate was 4.5%. TVR s share price was $71.51.
Problem #2 (5 Marks) At the beginning of 2020, TVR's beta was 1.4 and the risk-free rate was 4.5%. TVR s share price was $71.51. TVR's share price at the end of 2020 was $117.16. If you estimate the market risk premium to have been 6%, did TVR's managers exceed their investors' required return as given by CAPM? Show your work
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