Calculate the required return for a project undertaken in Italy given the following information.The appropriate risk free rate is 5%,the project has a calculated beta of 1.35 relative to the Italian stock market,and the market risk premium for the Italian stock market is 7%.

Question

Quizplus · Accepted Answer

The answer is calculated by using the formula: R - project = 5% + 1.35(7.0%).This gives you a required return of 14.45%.

Calculate the Required Return for a Project Undertaken in Italy