ellbellzzz8404 ellbellzzz8404

04-03-2020
Computers and Technology

contestada

Suppose the beta of Microsoft is 1.13, the risk-free rate is 3 percent, and the market risk premium is 8 percent. Calculate the expected return for Microsoft.

Respuesta :

FreshPrinxce FreshPrinxce

09-03-2020

Answer:

8.65%

Explanation:

Rj = Rf + risk premium.

Rj = Rf + β[E(RM − Rf)].

= 3 + 1.13 (8 - 3)

= 3 + 1.13 x 5

= 3 + 5.65

= 8.65 percent

This relationship between risk and expected return is called the security market line.

Answer Link

Otras preguntas

accurate estimation of 75-33

What is the complete predicate of the following sentence? Sharon and Jason went for a walk and then a bike ride.

Find the difference. 7 7/8 - 3 1/4 ?

How many feet is this please help

Each year Earth moves once around —

what was Rutherford's contribution to our knowledge of atoms

A company used about 7.4 × 105 sheets of paper in a month. Of the paper used during the month, the accounting department used about 8.9 × 103 of the sheets. Abo

graph the line y=5x-4

what two canadian provinces border Alaska?

A company used about 7.4 × 105 sheets of paper in a month. Of the paper used during the month, the accounting department used about 8.9 × 103 of the sheets. Abo