Find beta and determine the risk premium. The market risk premium is 8% and the risk-free rate is 2%.
A) 16.82%
B) 20.76%
C) 10.15%
D) 18.11%

Name: Find beta and determine the risk premium. The market risk premium is 8% and the risk-free rate is 2%. A) 16.82% B) 20.76% C) 10.15% D) 18.11%
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Question

Find beta and determine the risk premium. The market risk premium is 8% and the risk-free rate is 2%. 
A) 16.82% 
B) 20.76% 
C) 10.15% 
D) 18.11%

Quizplus · Accepted Answer

The answer was determined by using the statistical function on a financial calculator
Beta is 1.73
Risk premium = 1.73(12)
= 20.76% (The risk-free rate is surplus information)

Find Beta and Determine the Risk Premium