Reference no: EM133113915

1. You purchased 200 shares of Gardom Inc. stock for $38.12 a share. You have received a total of $290 in dividends and $8,050 in proceeds from selling the shares. What is your capital gains yield on this stock?

a. 3.8 percent

b. 4.2 percent

c. 6.9 percent

d. 5.6 percent

e. 9.4 percent

2. Bantam Co. has a current beta of 1.6. The market risk premium is 7 percent and the risk-free rate of return is 3 percent. Use the capital asset pricing model 'CAPM' to determine how much the expected return will increase if the company expands their operations such that their company beta rises to 1.9?

a.  0.30 percent

b.  0.90 percent

c.  1.50 percent

d.  2.10 percent

e.  2.70 percent