Chapter_6_Questions_7th_Edition_

Chapter_6_Questions_7th_Edition_ - 8.50 Company Beta Tasaco...

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Problem 6-6 (7th Edition) T-Bill Rate (Krf) = 7.50% Market Return (Km) = 11.50% CAPM Gives you the rate of return that the average investor in a particular stock expects to receive. (Ke). MFI Beta = 0.86 Required return = 10.94% Problem 6-7 Risk Premium = 4.30% Market Return (Km) = 12.80% Krf = Km - Risk Premium =
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Unformatted text preview: 8.50% Company Beta Tasaco 0.86 LBM 0.69 Exxos 0.58 Company Required Rate Tasaco 12.22% LBM 11.48% Exxos 10.97% Ke = Krf + x (km - Krf) β Problem 6-6 (7th Edition) Required return = 10.94% Problem 6-7 Company Required Rate Tasaco 12.22% LBM 11.48% Exxos 10.97%...
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