Find risk premium on the market

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Reference no: EM1345566

Risk Free rate 4% and the expected return on the market portfolio is 12%. Using the capital asset model:

(a). What is the risk premium on the market?
(b). What is the required return on an investment with a beta of 1.5?
(c). If an investment with a beta of .8 offers an expected return of 9.8%, does it have a positive NPV? and
(d). If the market expects a return of 11.2% from stock X, what is its beta? Please explain.

 

Reference no: EM1345566

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