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Use the information in the following table. Stansfield England World SD(%) ER(%) Stansfield 1.00 0.90 0.50 20 ? England 1.00 0.70 18 14 World 1.00
Use the information in the following table.
Stansfield | England | World | SD(%) | ER(%) | |
---|---|---|---|---|---|
Stansfield | 1.00 | 0.90 | 0.50 | 20 | ? |
England | 1.00 | 0.70 | 18 | 14 | |
World | 1.00 | 15 | 12 |
Suppose that the British stock market is integrated with the rest of the world and Stansfield Company has made its shares tradable internationally via cross-listing on the NYSE. Using the CAPM and a risk-free rate of 6%, estimate the equity cost of capital for Stansfield.
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