Question
The expected return on the stock is 15%, the risk-free
rate is 8% and the beta for the stock is 1.2. Compute the rate of return that would be expected on the stock.Solution
According to CAPM Expected return on a stock is equal to = risk free rate + beta (market rate – risk free rate) = 0.08 + 1.2 (0.15 – 0.08) = 0.164 = 16.4%
More Alternate Sources of Finance Questions
?% of (168 ÷ 8 × 20) = 126
20% of 1500 – 75% of 200 = 125% of ?
Find the value of 16 X [(8 - 5) of 12 ÷ 4].
√196 + (0.25 × 144) + 19 = ? + 72
22 * 6 + 45% of 90 + 65% of 180 = ?
52% of 400 + √(?) = 60% of 600 - 25% of 400
(25 × 12 + 30 × 8 – 22 × 10) = ?
What will come in the place of question mark (?) in the given expression?
(240% of 175 ÷ √16) X 6 + 80% of 400 = ?3 + 179 + 42
What will come in the place of question mark (?) in the given expression?
(144 × 16 ÷ 12) × 6 = ?
808 ÷ (128)1/7 + 482 = 4 × ? + 846
