Suppose the RiskFree Rate is 8%, the Expected Return this year on the S&P 500 stock market index is 13%, and the stock of Joe's Junkyard has a Beta of 1.4. Given these conditions what is the required rate of return for Joe's stock?

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Suppose the RiskFree Rate is 8%, the Expected Return this year on the S&P 500 ...

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Response provides guidance regarding computation of required rate of return for Joe's stock

See the attached file for data and answer the following questions:
12. What was Joe's NOPAT in 2013?
13. What was Joe's Free Cash Flow (FCF) in 2013? (Note: For this question, assume Joe obtained no new plant and equipment or additional net working capital in 2013. Thus his Net Investment in Operating Capital (NIOC) for

You have observed the following returns over time. Assume that the risk free rate is 6% and the market risk premium is 5%.
Year Stock X Stock Y Market
2006 14% 13% 12%
2007 19% 7% 10%
2008 -16% -5% -12%
2009 3% 1% 1%
2010 2

Problem: Suppose you are the money manager of a $4 million investment fund. The fund consists of four stocks with the following betas:
Stock Investment Beta
A $0.4 million 1.5
B $0.6 million (0.50)
C $1.0 million 1.25
D $2.0 million 0.75
If the market requiredrate of return is 14 percent and the risk-

The company is paying the dividend of $4.37 and has a growth rate of 6.5%. The stock is currently selling for $175.
Calculate the requiredrate of return.

The beta coefficient forstock C is bc=0.4 and that forstock D is bd=-.05. (stock D's beta is negative, indicating that its rate of return rises
whenever returns on most other stocks fall. There are very few negative beta stocks, although collection agency and gold mining stokcs
are sometimes cited as examples)

See attached file.
8- 1 EXPECTED RETURN
A stock's returns have the following distribution:
Calculate the stock's expected return, standard deviation, and coefficient of variation.
8- 3 REQUIREDRATE OF RETURN
Assume that the risk- free rate is 6% and the expected return on the market is 13%. What is the required

Find the requiredrate of return of a stock if the dividend is $4.45 per share, dividend growth rate of 6.5 % and the price of stock is $101 per share.
Thanks!

Woidtke Manufacturing's stock currently sells for $20 a share. The stock just paid a dividend of $1.00 a share (i.e, D0 = $1.00). The dividend is expected to grow at a constant rate of 10% a year. What stock price is expected 1 year from now? What is the requiredrate of return on the company's stock?