Determine the risk premium on the market

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The Treasury bill rate is 6%, and the expected return on the market portfolio is 12%. According to the capital asset pricing model:

a. What is the risk premium on the market?

b. What is the required return on an investment with a beta of 1.7? (Do not round intermediate calculations.)

c. If an investment with a beta of 0.7 offers an expected return of 9.3%, does it have a positive or negative NPV?

d. If the market expects a return of 11.4% from stock X, what is its beta? (Do not round intermediate calculations.)

Reference no: EM132694468

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