Find beta and determine the required rate of return. The market risk premium is 12% and the risk-free rate is 5%.
A) 12.61%
B) 8.27%
C) 10.11%
D) 14.84%

Name: Find beta and determine the required rate of return. The market risk premium is 12% and the risk-free rate is 5%. A) 12.61% B) 8.27% C) 10.11% D) 14.84%
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Question

Find beta and determine the required rate of return. The market risk premium is 12% and the risk-free rate is 5%. 
A) 12.61% 
B) 8.27% 
C) 10.11% 
D) 14.84%

Quizplus · Accepted Answer

Answer was determined by using the statistical function on a financial calculator.
Beta = .82
RRR = 5% + .82(12%)= 14.84%

Find Beta and Determine the Required Rate of Return