Question
Suppose that the Treasury bill rate is 6% rather than 2%. Assume that the expected return on the market stays at 10%. Use the following
Suppose that the Treasury bill rate is 6% rather than 2%. Assume that the expected return on the market stays at 10%. Use the following information. |
Stock | Beta () |
A | 1.78 |
B | 1.54 |
C | 1.53 |
D | 0.98 |
E | 0.95 |
F | 0.80 |
G | 0.75 |
H | 0.66 |
I | 0.42 |
J | 0.40 |
a. | Calculate the expected return from H. (Do not round intermediate calculations. Round your answer to 2 decimal places.) |
Expected return | % |
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.) |
Highest expected return | % |
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.) |
Lowest expected return | % |
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