What is the expected return for stock

Assignment Help Finance Basics
Reference no: EM132509955

Stock Actual Rate of Return Standard Deviation Beta C 11.2% 30% 0.9 K 17.2% 20% 1.1 Using that information above, The expected return on the stock market is 12% and the risk-free interest rate is 4%. What is the expected return for each stock, based on the CAPM?

Reference no: EM132509955

Questions Cloud

What is the company weighted average cost of capital : A company has $100 million worth of bonds outstanding with a yield to maturity of 4% and 25 million common shares outstanding worth $10 each.
What effect would election have on its financial statements : How do these classifications affect the accounting treatment for unrealized losses? What effect would election have on its financial statements
Evaluate scenarios involving ethical decisions : Assess the financial standing of an entity by examining relevant financial information and identify how disclosure techniques can support business decisions
What is the market risk premium : Suppose the stock of Walmart (WMT) is fairly priced and has the following info:
What is the expected return for stock : The expected return on the stock market is 12% and the risk-free interest rate is 4%. What is the expected return for each stock, based on the CAPM?
Evaluate how the is curve and mp curve : Evaluate how the IS curve and MP curve might be affected A decrease in financial frictions.
Identify the components of information system : Identify the components of an information system (IS) using the five-component framework, and provide a brief summary of each.
Estimate the expected return on bethlehem steel : Now assume that the beta in the capital asset pricing model for Bethlehem Steel is 1.1 and that the market risk premium for the market portfolio
Prepare journal entries to record the net deferred tax : Moulin & Company experienced a $326,000 net operating loss and recorded a deferred tax asset of $117,360. Prepare journal entries to record the net deferred tax

Reviews

Write a Review

Finance Basics Questions & Answers

  Prepare the worksheet entries for axel corp to eliminate

axel corporation acquires 100 of the stock of wheal company on december 31 year 4. the following information pertains

  If you buy the note you will receive 10 annual payments of

yield of a note. you can buy a note at a price of 13500. if you buy the note you will receive 10 annual payments of

  Find the future values of these ordinary annuities

Find the future values of these ordinary annuities. Compounding occurs once a year. a. $400 per year for 10 years at 10% b. $200 per year for 5 years at 5% c. $400 per year for 5 years at 0% d. Rework Parts a, b, and c assumingthey are annuities due.

  Percentages for different line items

In a pro forma income statement, why would a finance manager make changes in the prior year's percentages for different line items?

  Explain the risk characteristics of io and po strips

Using your answer in a, determine the value of both IO and PO strips with a discount rate of 10 percent under the assumption that the mortgage will not be prepaid.

  What is the effective annual yield of given compounded daily

Fred makes a deposit of £12,000 in a bank account. The deposit is to earn interest annually at the rate of 9% for seven years. What is the Effective Annual Yield of the above Compounded Daily?

  Calculate the net advantage to leasing

How would your answer to part a change if the lessee did not expect to pay any income taxes for the next three years but to pay income taxes each year thereafter at a 40% rate?

  What is the incremental savings of buying the valves

However, the space occupied by the production of the valve can be used by another production group that is currently leasing space for $55,000 per year. What is the incremental savings of buying the valves?

  Determining the consequence of decision

If the change in sales is the only consequence of this? decision, what are its benefits and? costs? Is it a good? idea?

  Determine the value of this annuity at the times

An annuity consists of 40 payments of $500 each made at intervals of 3 months. Interest is at j1 = 4.5%.

  Create a cash flow diagram of the savings amounts

An educational saving account is created. The account is set up such that the beneficiary will receive all money in the account.

  What is the present value of asset

What is the present value of this asset if the rate of return is 7.0%?

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