Calculate stock a beta

Assignment Help Finance Basics
Reference no: EM132412358

Required Rate of Return

Suppose rRF = 3%, rM = 12%, and rA = 13%.

  1. Calculate Stock A's beta. Round your answer to two decimal places.
  2. If Stock A's beta were 1.5, then what would be A's new required rate of return? Round your answer to two decimal places.

Reference no: EM132412358

Questions Cloud

Describe the adolescent life cycle in the given sections : Assess the physical and psychological changes an individual is likely to experience in one of the following four phases of the life cycle-early childhood.
Determine the current value of the bond : The par value of the bond is $1000. Determine the current value of the bond if present market conditions justify a 5% required rate of return.
Calculate the initial investment : Calculate the initial investment at t=0, operating cash flows at t=1, 2, 3, 4 and the termination cash flows at t=4.
Discussion about the ethnography of communication : Directions for the Ethnography of Communication: This paper is a combination of academic research and ethnographic research. Select a Subculture/Community.
Calculate stock a beta : If Stock A's beta were 1.5, then what would be A's new required rate of return? Round your answer to two decimal places.
What is the required rate of return on aa stock : What is the required rate of return on AA's stock? Round your answer to two decimal places.
Cash flow to equity model to value stock : Use the free cash flow to equity model to value this stock. Do not round intermediate calculations. Round your answer to the nearest cent.
Construct a table like the one from lecture : Construct a table like the one from lecture (Slide 50, November 20) showing profit and loss if the options expire when the stock price
What is the estimated cost of common equity : What is the estimated cost of common equity using the CAPM? Round your answer to two decimal places.

Reviews

Write a Review

Finance Basics Questions & Answers

  Computation of weighted average cost of capital

Computation of weighted average cost of capital and What is Jake's weighted average cost of capital

  Examine the concept of time value of money

Examine the concept of time value of money in relation to corporate managers. Propose two methods in which time value of money can help corporate managers.

  Future increases and the present value of annuity

Assume that all others factors are held constant and the interest rate is greater than zero, increasing the number of periods, will the present value

  Differences between sensitivity analysis and scenario

Discuss the important differences between sensitivity analysis and scenario analysis in the risk analysis of capital budgeting and, maybe more importantly

  What are the p/e ratios for the competitors

Analyze your stock by answering the following questions (in paragraph form): If your stock was valued at the Industry Average P/E Ratio for these figures, what would be its stock price? What are the P/E ratios for the competitors? Is your stock cheap..

  Two firms examined the same capital budgeting project

Two firms examined the same capital budgeting project which had an IRR of 19%. One firm accepted the project but the other rejected it. One of the firms must have made an incorrect decision.

  What is its economic value added

If Spencer's cost of capital is 10%, what is its Economic value added (EVA)?

  What is the bank cost of preferred stock

Sixth Fourth Bank has an issue of preferred stock with a $7.10 stated dividend that just sold for $76 per share.

  What is the present value of your winnings

What is the present value of your winnings?

  What is the firm debt-equity ratio

What is the firm's debt-equity ratio? (Round it to two decimal place, e.g., 1.58)

  What is the interest coverage ratio of each firm

What is the market debt-to-equity ratio of each firm? What is the book debt-to-equity ratio of each firm? What is the interest coverage ratio of each firm?

  Private residence in pennsylvania

Suppose that you are a lender and that you have issued a loan on a private residence in Pennsylvania. The borrower has defaulted on this mortgage

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!

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