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You are given the following information for Wine and Cork Enterprises (WCE): r RF = 4%; r M = 8%; RP M = 4%, and
You are given the following information for Wine and Cork Enterprises (WCE):
rRF = 4%; rM = 8%; RPM = 4%, and beta = 1.4
Q- Assume now that there is no change in inflation, but risk aversion increases by 2%. What is WCE's required rate of return now? Do not round intermediate calculations. Round your answer to two decimal places.
Q- If inflation increases by 2% and risk aversion increases by 2%, what is WCE's required rate of return now? Do not round intermediate calculations. Round your answer to two decimal places.
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