What is the expected return based on the capm

Assignment Help Finance Basics
Reference no: EM131732588

Question: CAPM. Suppose the risk-free rate is 8 percent. The expected return on the market is 14 percent. If a particular stock has a beta of .60, what is its expected return based on the CAPM? If another stock has an expected return of 20 percent, what must its beta be?

Reference no: EM131732588

Questions Cloud

Analyze legal ethical political and economic issues involved : Analyze the legal, ethical, regulatory, political and economic issues involved and prepare the paper in accordance with the latest APA guidelines.
Define insufficient blood in the coronary arteries : What condition occurs when there is insufficient blood in the coronary arteries
What is the competitive price and quantity sold : (a) If the market is perfectly competitive, then what is the competitive price and quantity sold?
Should you let your sister know about the hmrc visit : Briefly explain the legal issues here and then deal with the following questions. Should you let your sister know about the HMRC visit
What is the expected return based on the capm : CAPM. Suppose the risk-free rate is 8 percent. The expected return on the market is 14 percent. If a particular stock has a beta of .60.
What do you think about the public health course : What do you think about the Public Health course? Why is this topic important to Public Health? Why did you select this topic? What is its importance?
Damage to podocytes may cause which of the following effects : Which segment of the nephron is the major site of action for nephrotoxicants, Damage to podocytes may cause which of the following effects
Identify departmental and organizational survey : Identify departmental and organizational survey readiness for accreditation, licensing and/or certification processes
Differentiate-diversifiable and nondiversifiable risks : Diversifiable and Nondiversifiable Risks. In broad terms, why is some risk diversifiable? Why are some risks nondiversifiable?

Reviews

Write a Review

Finance Basics Questions & Answers

  Information about forward contract

Assume that your company will be receiving 30 million euros six months from now and the euro is currently selling for 1 euro per dollar.

  Calculate the price of a fifteen-year annual coupon bond

Calculate the price of a 15-year 4 percent annual coupon bond. Assume the market is yielding 5 percent on similarly risky instrument. Please show your work and explain why this is a premium or a discount bond.

  Computation of the financial performance of the company

Computation of the financial performance of the company with the help of the ratios and industry average

  Why would ?rms with high return on assets

Why would ?rms with high Return On Assets (ROA) refrain from leveraging up their ?rm by borrowing and investing the funds in pro?table assets?

  American call option on a non-dividend-paying stock

Consider a six-month American call option on a non-dividend-paying stock. The stock price is $30, the strike price is $29, and the continuously compounded risk-free interest rate is 6% per annum. The volatility of the stock price is 20% per annum...

  What was the capital gain of the tips in dollars

Consider a 3.50% TIPS with an issue CPI reference of 188.10. At the beginning of this year, the CPI was 198.90 and was at 205.20 at the end of the year.

  Record transactions for the purchase and return

On June 5, Staley Electronics purchases 100 units of inventory on account for $10 each. After closer examination, Staley determines 20 units are defective.

  A firm is evaluating an accounts receivable change

A firm is evaluating an accounts receivable change that would increase bad debts from 2% to 4% of sales. Sales are currently 50,000 units, the selling price is $20 per unit, and the variable cost per unit is $15. As a result of the proposed change, s..

  Explain what is meant by the informational content of

explain what is meant by the informational content of dividend

  Mcgriff manufacturing is reviewing a new proposal to invest

mcgriff manufacturing is reviewing a new proposal to invest in the production and distribution of a new product. the

  Problem regarding the shares of stock outstanding

There are 100,000 shares of stock outstanding which trade at their book value of $30. Compute BWP's contribution, contribution margin, EAT, DOL, and EPS.

  Coefficient of variation metal manufacturing has isolated

coefficient of variation metal manufacturing has isolated four alternatives for meeting its need for increased

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd