Question

AA Corporation's stock has a beta of 0.9. The risk-free rate is 3%, and the expected...

AA Corporation's stock has a beta of 0.9. The risk-free rate is 3%, and the expected return on the market is 9%. What is the required rate of return on AA's stock? Do not round intermediate calculations. Round your answer to one decimal place.

Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

Notes

1) If you have any queries kindly post a comment, i will solve it earliest.

2) If you satisfied with my answer, kindly give a thumbs up, it will help to encourage me

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
1a. Your investment club has only two stocks in its portfolio. $50,000 is invested in a...
1a. Your investment club has only two stocks in its portfolio. $50,000 is invested in a stock with a beta of 0.9, and $75,000 is invested in a stock with a beta of 1.3. What is the portfolio's beta? Do not round intermediate calculations. Round your answer to two decimal places. 1b. AA Corporation's stock has a beta of 0.4. The risk-free rate is 2%, and the expected return on the market is 12%. What is the required rate of...
Your investment club has only two stocks in its portfolio. $50,000 is invested in a stock...
Your investment club has only two stocks in its portfolio. $50,000 is invested in a stock with a beta of 0.8, and $30,000 is invested in a stock with a beta of 2.0. What is the portfolio's beta? AA Corporation's stock has a beta of 1.1. The risk-free rate is 4%, and the expected return on the market is 13%. What is the required rate of return on AA's stock? Do not round intermediate calculations. Round your answer to two...
1. Your investment club has only two stocks in its portfolio. $30,000 is invested in a...
1. Your investment club has only two stocks in its portfolio. $30,000 is invested in a stock with a beta of 0.5, and $45,000 is invested in a stock with a beta of 1.8. What is the portfolio's beta? Do not round intermediate calculations. Round your answer to two decimal places. 2. AA Corporation's stock has a beta of 0.8. The risk-free rate is 3%, and the expected return on the market is 11%. What is the required rate of...
The Up and Coming Corporation's common stock has a beta of 1. If the risk-free rate...
The Up and Coming Corporation's common stock has a beta of 1. If the risk-free rate is 3 percent and the expected return on the market is 15 percent, what is the company's cost of equity capital? (Do not round your intermediate calculations.) 18% 15% 15.75% 14.25% 15.6% *If possible, could you solve in excel and show the formulas? Thank you!
Required Rate of Return Stock R has a beta of 1.9, Stock S has a beta...
Required Rate of Return Stock R has a beta of 1.9, Stock S has a beta of 0.65, the expected rate of return on an average stock is 12%, and the risk-free rate is 4%. By how much does the required return on the riskier stock exceed that on the less risky stock? Round your answer to two decimal places. Historical Returns: Expected and Required Rates of Return You have observed the following returns over time: Year Stock X Stock...
A stock has a beta of 1.20 and an expected return of 14 percent. a risk-free...
A stock has a beta of 1.20 and an expected return of 14 percent. a risk-free asset currently earns 3 percent. What is the expected return on a portfolio that is equally invested in the two assets? ( do not round intermediate calculations and round your answer to 2 decimal places) If a portfolio of the two assets has a beta of .72 ,what are the portfolio weights?( do not round intermediate calculations and round your answer to 4 decimal...
A stock has an expected return of 10.2 percent, the risk-free rate is 5 percent, and...
A stock has an expected return of 10.2 percent, the risk-free rate is 5 percent, and the market risk premium is 9 percent. What must the beta of this stock be? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Multiple Choice .5778 .7562 .5168 .4333 .6008
Stock X has a 10.0% expected return, a beta coefficient of 0.9, and a 40% standard...
Stock X has a 10.0% expected return, a beta coefficient of 0.9, and a 40% standard deviation of expected returns. Stock Y has a 13.0% expected return, a beta coefficient of 1.3, and a 20% standard deviation. The risk-free rate is 6%, and the market risk premium is 5%. Calculate each stock's coefficient of variation. Do not round intermediate calculations. Round your answers to two decimal places. CVx = CVy = Which stock is riskier for a diversified investor? For...
A stock has a required return of 12%, the risk-free rate is 3%, and the market...
A stock has a required return of 12%, the risk-free rate is 3%, and the market risk premium is 3%. What is the stock's beta? Round your answer to two decimal places. If the market risk premium increased to 10%, what would happen to the stock's required rate of return? Assume that the risk-free rate and the beta remain unchanged. Do not round intermediate calculations. Round your answer to two decimal places. If the stock's beta is equal to 1.0,...
3.) The real risk-free rate is 2%, and inflation is expected to be 3% for the...
3.) The real risk-free rate is 2%, and inflation is expected to be 3% for the next 2 years. A 2-year Treasury security yields 5.6%. What is the maturity risk premium for the 2-year security? Round your answer to one decimal place. 4.) Renfro Rentals has issued bonds that have an 8% coupon rate, payable semiannually. The bonds mature in 10 years, have a face value of $1,000, and a yield to maturity of 7.5%. What is the price of...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT