Question
Risk-free rate is 3%. GMs Beta is 0.8 and the expected return rate of the stock market is 7%. If GMs stock earned 7% return
Risk-free rate is 3%. GMs Beta is 0.8 and the expected return rate of the stock market is 7%. If GMs stock earned 7% return last year, what must be the abnormal return rate according to CAPM formula (Hint: what is GMs expected return rate)?
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Cases In Healthcare Finance
Authors: George H. Pink, Paula H. Song
7th Edition
1640553177, 978-1640553170
