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 318 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
Great answer, keep it coming :)

peter

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

« previous next »
 

Did you know?

Earwax has antimicrobial properties that reduce the viability of bacteria and fungus in the human ear.

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?

More than 50% of American adults have oral herpes, which is commonly known as "cold sores" or "fever blisters." The herpes virus can be active on the skin surface without showing any signs or causing any symptoms.

Did you know?

Russia has the highest death rate from cardiovascular disease followed by the Ukraine, Romania, Hungary, and Poland.

Did you know?

The first oncogene was discovered in 1970 and was termed SRC (pronounced "SARK").

Lymphatic vessels pick up excess tissue fluid, purify it in the lymph nodes, and then return it to t Lymphatic vessels pick up excess tissue fluid, purify it in the lymph nodes, and then return it to t
Rate of Growth of Brain Areas Rate of Growth of Brain Areas
Men who are at risk for heart disease and report work-related stressors are at greater risk of death ... Men who are at risk for heart disease and report work-related stressors are at greater risk of death ...
Plasma protein binding and drug availability: (a) The drug exists in a free state or is bound to ... Plasma protein binding and drug availability: (a) The drug exists in a free state or is bound to ...
Gibs free energy for hydrolysis of some phosphate compounds Gibs free energy for hydrolysis of some phosphate compounds
A carbon-14 nucleus decays to a nitrogen-14 nucleus by beta-minus decay. How much energy (in ... A carbon-14 nucleus decays to a nitrogen-14 nucleus by beta-minus decay. How much energy (in ...
Video: Membrane Protein and Facilitated Transport (Passive Vs Active)

For a complete list of videos, visit our video library