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What impact on the required rate of return for common stock

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Reference no: EM132945166

Question - Baraka Inc. common stock has a beta of 0.90. The expected return on the market is 10 percent, and the risk-free rate is 6 percent:

1. Calculate the market risk premium?

2. Calculate the stock risk premium?

3. Assume that recent economic events have resulted in an increase of 2% in inflationary expectations, what impact on the required rate of return for common stock.

Reference no: EM132945166

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