A stock has a beta of 1.05, the expected return on the market is 14 percent, and

Question

A stock has a beta of 1.05, the expected return on the market is 14 percent, and the risk-free rate is 8.4 percent. What must the expected return on this stock be?

14.85%

A stock has an expected return of 15 percent, its beta is 0.7, and the risk-free rate is 8.25 percent. What must the expected return on the market be?

18.79%

You own a stock portfolio invested 15 percent in Stock Q, 25 percent in Stock R, 15 percent in Stock S, and 45 percent in Stock T. The betas for these four stocks are 0.79, 0.9, 0.71, and 1.05, respectively. What is the portfolio beta?

A stock has a beta of 1.05, the expected return on the market is 14 percent, and the risk-free rate is 8.4 percent. What must the expected return on this stock be?

Explanation / Answer

14.99%

.17.89%

0.92

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