Question
Suppose that the Treasury bill rate is 5% rather than 3%. Assume that the expected return on the market stays at 14%. Use the following
Suppose that the Treasury bill rate is 5% rather than 3%. Assume that the expected return on the market stays at 14%. Use the following information. |
Stock | Beta () |
A | 2.36 |
B | 1.95 |
C | 1.53 |
D | 1.40 |
E | 1.42 |
F | 1.08 |
G | 0.79 |
H | 0.71 |
I | 0.70 |
J | 0.42 |
a. | Calculate the expected return from H. (Do not round intermediate calculations. Round your answer to 2 decimal places.) |
b. | Find the highest expected return that is offered by one of these stocks. (Do not round intermediate calculations. Round your answer to 2 decimal places. |
c. | Find the lowest expected return that is offered by one of these stocks. (Do not round intermediate calculations. Round your answer to 2 decimal places.) |
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