Suppose that the British stock market is integrated with the rest of the world and Stansfield Company has made its shares tradable internationally via cross-listing on the NYSE.Using the CAPM and a risk-free rate of 5 percent,estimate the equity cost of capital for Stansfield. Correlation Coefficients
Stansfield England World SD(%) %
A) 12 percent
B) 10.60 percent
C) 6.60 percent
D) None of the options
Correct Answer:
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