Fill This Form To Receive Instant Help

Help in Homework
trustpilot ratings
google ratings


Homework answers / question archive / Assume the expected return on the market is 11 percent and the risk-free rate is 4 percent

Assume the expected return on the market is 11 percent and the risk-free rate is 4 percent

Finance

Assume the expected return on the market is 11 percent and the risk-free rate is 4 percent. (a 1) X Your answer is incorrect. What is the expected return for a stock with a beta equal to 2.00? (Round answers to 2 decimal places, e.g. 0.25.) Expected return 18

pur-new-sol

Purchase A New Answer

Custom new solution created by our subject matter experts

GET A QUOTE

Answer Preview

Expected Return as per CAPM = Risk Free Rate + Beta(Return on market - Risk Free Rate)

= 4% + 2(11% - 4%)

= 18%

The correct answer is 0.18