Assume that the risk-free rate is 5% and the market risk premium is 6%. What is the expected return for the overall stock market? What is the required rate of return on a stock that has a beta of 1.2?© BrainMass Inc. brainmass.com June 3, 2020, 11:52 pm ad1c9bdddf
Expected return for overall stock market=risk free rate+ market risk premium
Solution describes the methodology to calculate expected market return and required rate of return on a stock.