Question
Stock Y has a beta of 1.0 and an expected return of 13.0 percent. Stock Z has a beta of 0.5 and an expected return
Stock Y has a beta of 1.0 and an expected return of 13.0 percent. Stock Z has a beta of 0.5 and an expected return of 7.8 percent.
| What would the risk-free rate have to be for the two stocks to be correctly priced? (Round your answer to 2 decimal places. (e.g., 32.16)) |
| Risk-free rate =_____________________ | % |
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Cases In Financial Management
Authors: I.M. Pandey
3rd Edition
0071333428, 978-0071333429
