ABC Manufacturing has a beta of 1.65, while XYZ Industries has a beta of 0.85. The required return on the stock market is 12.00% and the risk-free rate is 5.00%. What is the difference between ABC and XYZ's required rates of return?© BrainMass Inc. brainmass.com March 4, 2021, 9:25 pm ad1c9bdddf
Ke = Rf + b (Km - Rf)
Ke = Required rate of return ...
This is a comparison of two company's required rates of return.