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 REQUIRED RATE OF RETURN Assume that the risk-free rate is 6% and the expected return on the market is 13%. What is the required rate of return on a stock with a beta of 0.7?

8-5 BETA AND REQUIRED RATE OF RETURN A stock has a required return of 11%, the risk-free rate is 7%, and the market risk premium is 4%.
a. What is the stock's beta?
b. If the market risk premium increased to 6%, what would happen to the stock's required rate of return? Assume that the risk-free rate and the beta remain unchanged.

8-7 PORTFOLIO REQUIRED RETURN Suppose you are the money manager of a $4 million investment fund. The fund consists of four stocks with the following investments and betas:

If the market's required rate of return is 14% and the risk-free rate is 6%, what is the fund's required rate of return?

8-11 CAPM AND REQUIRED RETURN Calculate the required rate of return for Manning Enterprises assuming that investors expect a 3.5% rate of inflation in the future. The real risk-free rate is 2.5%, and the market risk premium is 6.5%. Manning has a beta of 1.7, and its realized rate of return has averaged 13.5% over the past 5 years.

... Answers 4 questions: 1) Returns on an ... given the probability distribution of return 2) Dublin ... Corporation's common stock: calculates required return using CAPM. ...

... What are the required rates of return for the three securities ... Risk-free rate 8.5% 8.5% 4.3% (C) Risk premium 4.3% 4.3% Required rate of returns 12.026% =B ...

... The required rate of return on the stock is 15 percent when the required return on an average stock is 10 percent. ... Step 2:Calculate the required return. ...

... JPMorgan & Chase Company, but the researcher believes that what is more representative are the returns for the Financials. They require rate or return for the ...

... 8. When the required return equals the coupon interest rate, the bond's value ... A common approach of estimating the variability of returns involving forecasting ...

... to slow to 2% per year for the next five years before the company returns to its long term growth rate of 5%. If investors have a required rate of return of 11 ...

... 25. You own a portfolio with the following expected returns given the various ... rate = (1.86 - 1.80)/1.80 = 3.33% Stock price = 1.86/(required return - 0.033) 50 ...

... A member is not required to fol- low a standard format or ... or transactions considered would be reported on the taxpayer's tax returns. ... 1, Tax Return Positions. ...

... a. What is the IRR of these cash flows? b. What does the firm's required return on projects of such risk have to be for this project to be undertaken? Explain. ...