What you need to know about Required Rate of return

The real risk-free rate is 2.00%, investors expect a 3.00% future inflation rate, the market risk premium is 4.70%, and Kohers Enterprises has a beta of 1.10. What is the required rate of return on Kohers' stock?

a. 9.43%
b. 9.67%
c. 9.92%
d. 10.17%
e. 10.42%

Solution Summary

The solution explains how to determine the required rate of return on the given stock