65.0k views
5 votes
The risk-free rate of return is 3.5% and the market risk premium is 7.5%. What is the expected rate of return on a stock with a beta of 1.28?

User Sjagr
by
8.3k points

1 Answer

3 votes

Answer:

13.1%

Step-by-step explanation:

Expected return = risk free rate + ( beta × Market premium)

3.5% + (1.28 × 7.5) = 13.1%

I hope my answer helps you

User Morteng
by
8.7k points

No related questions found

Welcome to QAmmunity.org, where you can ask questions and receive answers from other members of our community.