if Coppa Product's has a Beta of 1.85, the risk free rate is 2.25% and the return of the market is 7.25% what is the exp...

Question

Question

if Coppa Product's has a Beta of 1.85, the risk free rate is 2.25% and the return of the market is 7.25% what is the expected return of the company?

12.75

11.25

12

11.50

business finance

Answer 1

Answer #1

Expected Return Risk free Rate Ke Rf As per CAPM Rf+beta*(Rm-Rf) 0.0225+1.85*(0.0725-0.0225) Return on market Market risk pre

Answer 2

Similar Homework Help Questions

What is the expected return of Seaside Corp if the risk free rate is 1.85%, the stock's beta is 1.41, and the market pre...

What is the expected return of Seaside Corp if the risk free rate is 1.85%, the stock's beta is 1.41, and the market premium is 6.4%? What is the expected market return if Seaside's expected return is instead 12.6%? How does Seaside's beta change if the expected return is 12.6%, but the market premium remains at 6.4%?
TOISRULIUSS. Expected Return = Risk free Rate + beta (expected market return - risk free rate)...

TOISRULIUSS. Expected Return = Risk free Rate + beta (expected market return - risk free rate) .04 +0.80.09 - .04) = .08 = 8.0% 3. Suppose the MiniCD Corporation's common stock has a return of 12%. Assume the risk- free rate is 4%, the expected market return is 9%, and no unsystematic influence affected Mini's return. The beta for MiniCD is:
The Up and Coming Corporation's common stock has a beta of 1.85. If the risk-free rate...

The Up and Coming Corporation's common stock has a beta of 1.85. If the risk-free rate is 0.03 and the expected return on the market is 0.09, what is the company's cost of equity capital? Enter the answer with 4 decimals (e.g. 0.1234).

Cooley Company's stock has a beta of 0.60, the risk-free rate is 2.25%, and the market risk premium is 5.50%. What...

Cooley Company's stock has a beta of 0.60, the risk-free rate is 2.25%, and the market risk premium is 5.50%. What is the firm's required rate of return? Do not round your intermediate calculations. 5.55% 4.38% 6.60% 6.16% 4.66%
Security X has an expected rate of return of 21% and a beta of 1.85. The...

Security X has an expected rate of return of 21% and a beta of 1.85. The risk-free rate is 3%, and the market expected rate of return is 12%. According to the capital asset pricing model, security X is _________. A. overpriced B. none of these answers C. underpriced D. fairly priced
beta is 0.25. If the risk-free rate is 1.08%, and the market portfolio is expected to...

beta is 0.25. If the risk-free rate is 1.08%, and the market portfolio is expected to return 7.25%. What is the expected return on stock? using calc

A stock has an expected return of 9%. What is its beta? Assume the risk-free rate...

A stock has an expected return of 9%. What is its beta? Assume the risk-free rate is 6% and the expected rate of return on the market is 12%. (Negative value should be indicated by a minus sign. Round your answer to 2 decimal places.) Problem 7-23 A stock has an expected return of 9%. What is its beta? Assume the risk-free rate is 6% and the expected rate of return on the market is 12%. (Negative value should be...
15. Newsome's stock has a beta of 1.20, Its required return is 11.50%, and the risk-free rate the required rate of...

15. Newsome's stock has a beta of 1.20, Its required return is 11.50%, and the risk-free rate the required rate of return on the market? (Hint: First find the market risk premium.) a. 10.30% b. 10.62% c. 10.88% d. 10.15% e. 11.43% d return is 11.50%, and the risk-free rate is 4.30%. What is VRP
ABC Company's stock has a beta of 1.95, the risk-free rate is 2.25%, and the market risk premium is 6.75%. What is A...

ABC Company's stock has a beta of 1.95, the risk-free rate is 2.25%, and the market risk premium is 6.75%. What is ABC's required rate of return using CAPM? Enter your answer rounded to two decimal places. Do not enter % in the answer box. For example, if your answer is 0.12345 or 12.345% then enter as 12.35 in the answer box. Ripken Iron Works believes the following probability distribution exists for its stock. What is the standard deviation of...

Magee Company's stock has a beta of 1.20, the risk-free rate is 4.50%, and the market...

Magee Company's stock has a beta of 1.20, the risk-free rate is 4.50%, and the market risk premium is 5.00% What is Magee's required return? a. 10.50% b. 11.25%