Question
A share is quoted at Rs. 60. An investor expects the
company to pay a dividend of Rs. 3 per share, one year from now. The expected price of share after one year is Rs. 78.50. If the beta of the share is 1.5, the risk free rate is 6% and the market risk premium is 10%, what would be the required rate of return?Solution
To calculate the required rate of return, we can use the Capital Asset Pricing Model (CAPM): Required Rate of Return (Cost of Equity) = Risk-Free Rate + Beta * Market Risk Premium Given values: Beta (β) = 1.5 Risk-Free Rate = 6% Market Risk Premium = 10% Required Rate of Return = 6% + 1.5 * 10% Required Rate of Return = 6% + 15% Required Rate of Return = 21% So, the required rate of return is 21%. The answer is b. 21%.
Statements: A ≥ B ≥ Y = Z = M ≥ N ≤ E ≤ F = J
Conclusions:
I. F > Z
II. J ≤ Y
...Statements: F > V > W ≥ L > G; F ≤ O = M < I
Conclusions: I. M > LÂ Â Â II. V < I
In the question, assuming the given statements to be true, find which of the conclusion (s) among given three conclusions is /are definitely true and t...
Statement: A ≥ B ≥ C = D > E, F > G = H ≤ CÂ
Conclusion: I. C ≥ F                         II. F > D
...In the question, assuming the given statements to be true, find which of the conclusion (s) among given three conclusions is/are definitely true and th...
Statements: T < Q ≥ L; W < Q ≥ E; E < S
Conclusions:
I. T < S
II. S > Q
III. E < L
Statements:
B > L > M ; M = W ; L < Q
Conclusions:
I. W < L
II. M < B
III. B > Q
Statements : R < O ≤ P < Q; M < L ≤ N > O; S < Q ≤ K
Conclusions:
I. M < K
II. N > R
III. O < S
Statements: P < Q = S ≥ U; V ≤ P ≥ N > I
Conclusions: I. U < V II. Q > I
...Statements: J ≤ K = L ≤ N; N ≤ O = M
Conclusions: I. M = JÂ Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â II. J < M
...
