What is the company new required rate of return

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Reference no: EM13289622

Mikkelson Corporation's stock had a required return of 13.50% last year, when the risk-free rate was 5.50% and the market risk premium was 4.75%. Then an increase in investor risk aversion caused the market risk premium to rise by 2%. The risk-free rate and the firm's beta remain unchanged. What is the company's new required rate of return?

A. 16.36%
B. 16.17%
C. 15.52%
D. 16.87%
E. 20.58%

Reference no: EM13289622

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