Expected Stock Return in Market
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A stock has an expected return of 9 percent, its beta is 0.45, and the risk-free rate is 4.95 percent. The expected return on the market must be ______ percent? round answer to 2 decimal places.
I keep using the formula E(Ri)=Rf+{E9Rm)- Rf} x Bi and answer does not look right.
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Solution Summary
The solution examines expected stock return for beta in a market.
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The expected return on the market must be ______ percent
This will be:
Expected return= Risk free rate + Beta *(Market rate-Risk free ...
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