Based on the capm what is the expected return on the market


Suppose you observe the following situation:

Security Beta Expected return

Pete Corp. 1.10 .120

Repete Co. .79 .093

Assume these securities are correctly priced.

What is the risk-free rate? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

Risk-free rate % =

Based on the CAPM, what is the expected return on the market? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

Expected return on market =

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Financial Management: Based on the capm what is the expected return on the market
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