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Siscoman Inc . has a beta of 1.94 and an actual expected return of 17.25 percent. The risk-free rate of return is 3.19 percent and
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Siscoman Inc. has a beta of 1.94 and an actual expected return of 17.25 percent. The risk-free rate of return is 3.19 percent and the market rate of return is 11.78 percent. Is the stock fairly priced?
CAPM = 21.89%, overpriced.
CAPM = 15.55%, underpriced.
CAPM = 17.25%, fairly priced.
CAPM = 19.85%, overpriced.
Siscoman Inc. has a beta of 1.94 and an actual expected return of 17.25 percent. The risk-free rate of return is 3.19 percent and the market rate of return is 11.78 percent. Is the stock fairly priced?
| CAPM = 21.89%, overpriced. | ||
| CAPM = 15.55%, underpriced. | ||
| CAPM = 17.25%, fairly priced. | ||
| CAPM = 19.85%, overpriced. |
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Contemporary Financial Management
Authors: R. Charles Moyer, William J. Kretlow, James R. Mcguigan
8th Edition
