Portfolios-what must be the risk-free rate

Assignment Help Financial Management

Reference no: EM131878344

Assume both portfolios A and B are well diversified, that E(rA) = 12.6% and E(rB) = 13.6%. If the economy has only one risk factor, and βA = 1 while βB = 1.2, what must be the risk-free rate?

(Do not round intermediate calculations. Enter your answer as a percentage rounded to 1 decimal places.)

Reference no: EM131878344

Questions Cloud

Your investments during retirement : Assuming you can earn 12% on your investments BEFORE retirement and 7% on your investments DURING retirement,

Bob burgers assume that there will be hurdle rate : The owners of Bob's Burgers assume that there will be a hurdle rate of 6%, should they make the investment?

Duration of this bond years : What is the duration of this bond? Assume annual payments. Duration of this bond years

Calculate the fair present values of the bonds : Calculate the fair present values of the following bonds, all of which pay interest semiannually, The bond has a 6.2 percent coupon rate.

Portfolios-what must be the risk-free rate : Assume both portfolios A and B are well diversified, that E(rA) = 12.6% and E(rB) = 13.6%. what must be the risk-free rate?

Economy has only one risk factor : If the economy has only one risk factor, and ßA = 1 while ßB = 1.1, what must be the risk-free rate?

What would be the expected return on zero-beta stock : What is the expected return on the market portfolio? What would be the expected return on a zero-beta stock?

What is the expected return on the market portfolio : What is the expected return on the market portfolio? What would be the expected return on a zero-beta stock?

About the industrial production rate and the inflation rate : what will be your expected rate of return on the stock, given the new information about the industrial production rate and the inflation rate?

User Account

All Pages