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XYC's current stock price is $65.00. Analysts forecast that XYC's stock price will be $90 in one year, and its Beta is 1.25. Using the
XYC's current stock price is $65.00. Analysts forecast that XYC's stock price will be $90 in one year, and its Beta is 1.25. Using the CAPM, what is the minimum acceptable return for XYC, assuming a risk-free rate of 2.5 percent and equity (or market) risk premium of 4.5 percent?
| A. | 5.00% | |
| B. | 8.13% | |
| C. | 7.00% | |
| D. | 5.63% |
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