Question
You own $18,252 of Opsware, Inc., stock that has an assumed beta of 3.88. You also own $29,406 of Lowes Companies (assumed beta = 1.58)
| You own $18,252 of Opsware, Inc., stock that has an assumed beta of 3.88. You also own $29,406 of Lowes Companies (assumed beta = 1.58) and $3,042 of New York Times (assumed beta = 0.91). Assume that the market return will be 10 percent and the risk-free rate is 2 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.) |
| Opswares risk premium | % |
| Lowes risk premium | % |
| New York Times 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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Financial Management EMEA Theory And Practice
Authors: Michael Ehrhardt, Roland Fox, Eugene Brigham
2nd Edition
1473760216, 9781473760219
