Find the expected return on the market portfolio

Assignment Help Financial Accounting

Reference no: EM1310112

The expected return on the market portfolio is 15%. The risk-free rate is 8%. The expected return on SDA Corp. common stock is 16%. The beta of SDA Corp. common stock is 1.25. Within the context of the capital asset pricing model, __________.

A) SDA Corp. stock is underpriced
B) SDA Corp. stock is fairly priced
C) SDA Corp. stock's alpha is -0.75%
D) SDA Corp. stock alpha is 0.75%

Reference no: EM1310112

Questions Cloud

Able to adapt to the changing context : Elucidate how well will the company be able to adapt to the changing context.

Determining the basis for loss : Marsha Moore gave property with an adjusted basis of $28,000 to Alfred when the fair market value of the property was $25,000-What is Alfred’s basis for gain? What is his basis for loss?

Computation of number of stocks and stock price : Computation of number of stocks and stock price and Assume there is no capital gains tax

Find out the tension in each wire : Five people are playing tug-of-war. Anders and alyson pull to the right with 44 N and 34 N, correspondingly. Calid and Marisol pull to the left with 55 N and 35 N, respectively. With what force and in what direction does Benito pul of the game is tie..

Find the expected return on the market portfolio : The beta of SDA Corp. common stock is 1.25. Within the context of the capital asset pricing model - find the expected return on the market portfolio

Political environment and international business : Political environment in international business.

Video synopsis-language development : Recognize the concepts which you learned from the video and share one aspect that you found to be most interesting.

Financing sources city enterprise fund : A city's Enterprise Fund issued revenue bonds with a face value of $10,000,000-the Enterprise Fund will report total other financing sources in the amount of

Effort to develop perspectives also provide supporting : Students must make an effort to develop perspectives also provide supporting analyses, also incorporate some OB (Organizational Behavior) concepts in the analyses.

User Account

All Pages