What is the difference between required rates of return

Assignment Help Financial Management

Reference no: EM131887175

1. Company A has a beta of 0.70, while Company B's beta is 1.45. The required return on the stock market is 11.00%, and the risk-free rate is 2.25%. What is the difference between A's and B's required rates of return? (Hint: First find the market risk premium, then find the required returns on the stocks.) Do not round your intermediate calculations.

a. 4.71%

b. 4.25%

c. 4.30%

d. 5.06%

e. 5.01%

2. What is the PV of an ordinary annuity with 10 payments of $4,100 if the appropriate interest rate is 5.5%?

a. $30,904.27

b. $32,140.44

c. $37,085.12

d. $31,213.31

e. $32,449.48

Reference no: EM131887175

Questions Cloud

Identify a key element of health communication : Identify a key element of health communication that is essential for public health leader, in particular a leader who wishes to address issue you have selected.

Confidence interval of ratio : An advisory company has determined that 31% of a sample of 95 branches have clear signs of poor management. Build a confidence interval of 98% for this ratio.

State the null hypothesis and the alternate hypothesis : a. State the null hypothesis and the alternate hypothesis. (Round your answer to 2 decimal places.) H0: µ = H1: µ

Explain why you chose the study and how the information : Explain why you chose this study and how this information could be used in your selected area of education (academic, staff, or patient).

What is the difference between required rates of return : The required return on the stock market is 11.00%, and the risk-free rate is 2.25%. What is the difference between A's and B's required rates of return?

Effects of unemployment and policing on murder : A criminologist is interested in the effects of unemployment and policing on murder and has run the following multiple regression:

What are the professional accomplishments of each individual : What are the professional accomplishments of each individual? What skills or ideas demonstrated by these leaders might you apply to your professional practice?

Calculate the regression slope and y-intercept : A researcher has gathered data from seven randomly selected correctional employees on the number of years (X) the employees have worked

Create policies to address electronic health record document : Create two policies to address electronic health record documentation. The Completion of Health Records (adhering to TJC timeline)...including various forms.

User Account

All Pages