This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: Given an expected market return of 12.0, a beta of 0.75 for Benson Industries, and a risk-free rate ... (Read 310 times)

wenmo

  • Hero Member
  • *****
  • Posts: 540
on: Jul 10, 2018
Given an expected market return of 12.0, a beta of 0.75 for Benson Industries, and a risk-free rate of 4.0, what is the expected return for Benson Industries?
 
  A) 13.0
  B) 10.0
  C) 9.0
  D) 4.0

Question 2

The Security Market Line has ________.
 
  A) a positive slope
  B) a negative slope
  C) no slope
  D) a beta of 1.0


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

Harbringer

  • Sr. Member
  • ****
  • Posts: 329
Reply #1 on: Jul 10, 2018
Answer to Question 1

Answer: B
Explanation: B) The equation for the SML is E(ri) = rf + (rf + E(rm) - rf  i)
= 4.00 + 0.75  (12.00 - 4.00) = 10.00.

Answer to Question 2

Answer: A


wenmo

  • Member
  • Posts: 540
Reply 2 on: Jul 10, 2018
Excellent

nanny

  • Member
  • Posts: 313
Reply 3 on: Yesterday
Great answer, keep it coming :)

« previous next »
 

Did you know?

In 1864, the first barbiturate (barbituric acid) was synthesized.

Did you know?

There are more bacteria in your mouth than there are people in the world.

Did you know?

Eating carrots will improve your eyesight. Carrots are high in vitamin A (retinol), which is essential for good vision. It can also be found in milk, cheese, egg yolks, and liver.

Did you know?

In women, pharmacodynamic differences include increased sensitivity to (and increased effectiveness of) beta-blockers, opioids, selective serotonin reuptake inhibitors, and typical antipsychotics.

Did you know?

Disorders that may affect pharmacodynamics include genetic mutations, malnutrition, thyrotoxicosis, myasthenia gravis, Parkinson's disease, and certain forms of insulin-resistant diabetes mellitus.

Effects of growth rate on development. Effects of growth rate on development.
Diabetes mellitus. The metabolic disease diabetes mellitus, with symptoms of polydipsia, polyuria, a Diabetes mellitus. The metabolic disease diabetes mellitus, with symptoms of polydipsia, polyuria, a
beta lactamase mechanism beta lactamase mechanism
Risk for falls Risk for falls
Shope’s Model of Young Driver Crash Risks The model shows that many factors contribute to crash ris Shope’s Model of Young Driver Crash Risks The model shows that many factors contribute to crash ris
How would you rate your overall health?” The percent of adults answering “excellent” or ... How would you rate your overall health?” The percent of adults answering “excellent” or ...
Video: Factors that affect conduction rates (myelination, axon diameter & temperature)

For a complete list of videos, visit our video library