User Account

All Pages

Calculate market risk premium and expected rate

Assignment Help Finance Basics
Reference no: EM132953523

Stock A has a beta of 0.4, and investors expect it to return 8%. Stock B has a beta of 1.6, and investors expect it to return 14%. Use the CAPM to calculate the market risk premium and the expected rate of return on the market

Market Risk Premium =

Expected rate of return =

Reference no: EM132953523

Questions Cloud

Analyst assessment of betas : According to your favorite security analyst (who is very good at estimating betas, expected returns, and standard deviations):
Accounting records of practice are to updated-true or false : When a law practice receives a payment from a client for services rendered the transaction will be recorded in the trust cash receipts journal.-True or false
Discuss the economic reasons for the size of exposure : You are a security analyst responsible for following Jaguar's stock after it floats. (Assume the company had 100 million shares outstanding.)
Clients ledger keeps a record of transactions- true or false : When a law practice receives money for fees charged to a correspondent, the transaction will be recorded in the business cash payments journal.
Calculate market risk premium and expected rate : Stock B has a beta of 1.6, and investors expect it to return 14%. Use the CAPM to calculate the market risk premium and the expected rate of return on the marke
Calculate coleman weighted average cost of capital : Coleman Company has a target debt-to-equity ratio (i.e., D/E, not the weight of debt D/(D+E)) of 0.8 and a beta of 0.7 Coleman's pre-tax cost of debt is 10% and
Find what the entry on march in book of first entry will be : On 8 March 2021, a debit order for R989 in favour of SA Insurance, What the entry on 8 March 2021 in the book of first entry will be
What is the company weighted average cost of capital : The pre-tax cost of debt is 4%, and the cost of equity is 8%. The company's tax rate is 25%. What is the company's weighted average cost of capital (funding)
What entry be recorded in journal with columns for bank : What entry will be recorded in the journal with columns for bank, purchases, creditors, wages, VAT input, VAT output (cr) and sundry accounts as follows

Reviews

Write a Review

Finance Basics Questions & Answers

  Explain the benefits of risk management

Identify and explain the benefits of risk management mentioned in the Indian case study above. Discuss other benefits of Enterprise Risk Management

  Calculate the payback period and net present value

The tax rate is 30%, and the cost of capital is 14%. Required Calculate the Payback Period and Net Present Value followed by your recommendations.

  What was duke energy net working capital for recent years

Net Working Capital. Duke Energy is one of the world's largest energy companies. Go to the company's home page at www.dukeenergy.com.

  Find appropriate quote and calculate the price

As the cash manager of your firm, you wish to buy $1,000,000 in thirty day Treasury bills. You obtain the following bid/ask quotes from three dealers:

  What factors and incentives motivate companies management

what factors and incentives motivate companies management to engage in earnings

  What is the risk premium on the market

The Treasury bill rate is 6%, and the expected return on the market portfolio is 14%. According to the capital asset pricing model:

  Should the machine be purchased

If the project's cost of capital is 14 %, what is the NPV of the project? Do not round intermediate calculations. Round your answer to the nearest dollar.

  What is the cost of equity

The return on Treasury bills is 4 per cent and the market has a 12 per cent rate of return. What is the cost of equity?

  Advantages and disadvantages of the payback method

How does the accounting rate of return (ARR) differ from the internal rate of return (IRR)? List the advantages and disadvantages of the payback method.

  Reserach on Balanced scorecard

Reserach on Balanced scorecard Assignmnet help and solutions:-Balanced scorecard,ethical leadership, emotional intelligen ,sustainability

  Review problem of venezuela company

Venezuela Co. is building a new hockey arena at a cost of $2,500,000. It received a downpayment of $500,000 from local businesses to support the project.

  How are sales & loans used as lifetime tranfer tools

How are sales & loans used as lifetime tranfer tools in estate planning? What are the reasons/advantages and threats/disadvantes of using these tools?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd