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Author Question: The risk free rate is 3%. The expected rate of return on the market is 10%. Betas and the expected ... (Read 88 times)

Darron12

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Question 1

The most uncertain value used in the Capital Asset Pricing Model is
◦ beta.
◦ the risk-free rate.
◦ expected return on the market.
◦ all are equally uncertain.

Question 2

The risk free rate is 3%.  The expected rate of return on the market is 10%.  Betas and the expected rates of return for four stocks are as follows.: BWI 0.9 , 10%; ORH 1.0, 10%; ORL 1.4 , 12.6%, and DEL 1.5, 18%.  Based on a comparison of each stock's expected return versus its required return, which of these stocks should not be purchased?
◦ BWI
◦ ORH
◦ ORL
◦ DEL


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Marked as best answer by Darron12 on Mar 29, 2022

Mynameisrandom

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Darron12

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Reply 2 on: Mar 29, 2022
:D TYSM


shewald78

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Reply 3 on: Yesterday
Excellent

 

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