This topic contains a solution. Click here to go to the answer

Author Question: You have been given an opportunity to invest in a stock. Recent trends suggest that a one percent ... (Read 61 times)

Evvie72

  • Hero Member
  • *****
  • Posts: 519
You have been given an opportunity to invest in a stock. Recent trends suggest that a one percent rise in the stock market leads to approximately a two and one-half percent rise in the price of this stock.
 
  The real risk-free rate currently stands at 6 and stocks on average have provided 12 returns. Using the capital asset pricing model, determine the appropriate discount rate for the stock in question.

Question 2

Those who engage in the practice of discrimination today are generally quite blatant.
 
  Indicate whether the statement is true or false



Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

sylvia

  • Sr. Member
  • ****
  • Posts: 331
Answer to Question 1

Discount rate = rf + (rm - rf)
 = 2.5
R = 6 + 2.5(12  6 )
R = 6 + 15
= 21

Answer to Question 2

F




Evvie72

  • Member
  • Posts: 519
Reply 2 on: Jul 1, 2018
:D TYSM


peter

  • Member
  • Posts: 330
Reply 3 on: Yesterday
YES! Correct, THANKS for helping me on my review

 

Did you know?

Astigmatism is the most common vision problem. It may accompany nearsightedness or farsightedness. It is usually caused by an irregularly shaped cornea, but sometimes it is the result of an irregularly shaped lens. Either type can be corrected by eyeglasses, contact lenses, or refractive surgery.

Did you know?

Parkinson's disease is both chronic and progressive. This means that it persists over a long period of time and that its symptoms grow worse over time.

Did you know?

Your heart beats over 36 million times a year.

Did you know?

Every 10 seconds, a person in the United States goes to the emergency room complaining of head pain. About 1.2 million visits are for acute migraine attacks.

Did you know?

The top 10 most important tips that will help you grow old gracefully include (1) quit smoking, (2) keep your weight down, (3) take supplements, (4) skip a meal each day or fast 1 day per week, (5) get a pet, (6) get medical help for chronic pain, (7) walk regularly, (8) reduce arguments, (9) put live plants in your living space, and (10) do some weight training.

For a complete list of videos, visit our video library