The stock of Wiley United has a beta of .98.The market risk premium is 7.6 percent and the risk-free rate is 3.9 percent.What is the expected return on this stock?
A)7.53 percent
B)7.69 percent
C)11.35 percent
D)11.52 percent
E)12.01 percent

Question

Quizplus · Accepted Answer

The expected return can be calculated using the Capital Asset Pricing Model (CAPM): Expected Return = Risk-Free Rate + Beta * Market Risk Premium = 3.9% + 0.98 * 7.6% = 11.35%.

The Stock of Wiley United Has a Beta of