Question
You own $18,126 of Dennys Corp stock that has an assumed beta of 3.00. You also own $25,281 of Qwest Communications (assumed beta = 1.99)
| You own $18,126 of Dennys Corp stock that has an assumed beta of 3.00. You also own $25,281 of Qwest Communications (assumed beta = 1.99) and $4,293 of Southwest Airlines (assumed beta = 0.77). Assume that the market return will be 11.0 percent and the risk-free rate is 2.0 percent. |
| What is the market risk premium? |
| Market risk premium | % |
| What is the risk premium of each stock? (Round your answers to 2 decimal places.) |
| Dennys risk premium | % |
| Qwests risk premium | % |
| Southwest Airlines risk premium | % |
| What is the risk premium of the portfolio? (Do not round intermediate calculations. Round your final answer to 2 decimal places.) |
| Portfolio risk premium | % |
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The Public Private Partnership Handbook
Authors: Malcolm Morley
1st Edition
0749474262, 978-0749474263
