# Required Rate of Return for CAPM.

Kingsmen, Inc. is an all equity financed firm. The beta is .75, the market risk premium is 8% and the risk free rate is 4%. The cost of debt at companies of similar risk is 7%. What is the required return on the stock of Kingsmen?

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#### Solution Summary

The expert examines the required rate of return for equity financed firm.

$2.19