A firm has a beta of 0.6. If the return on the market is 9% and...

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Question

A firm has a beta of 0.6. If the return on the market is 9% and the risk-free return is 2%, then what is the firm's required return?

business finance

Answer 1

Answer #1

required return=risk-free rate +Beta*(market rate- risk-free rate)

=2+0.6*(9-2)

which is equal to

=6.20%

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Answer 2

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