# Expected return on Morrow's stock

Suppose the expected return on the market portfolio is 14.7 percent and the risk-free rate is 4.9 percent.

Morrow Inc.stock has a beta of 1.3 Assume the capital-asset-pricing model holds.

a. What is the expected return on Morrow's stock?

b. If the risk-free rate decreases to 3.7 percent, what is the expected return on Morrow's

stock?

https://brainmass.com/business/accounting/expected-return-on-morrow-s-stock-67145

#### Solution Summary

This provides the steps to compute the expected return on Morrow's stock

$2.19