By how much does the required return on the riskier stock


1. Required rate of return

Stock R has a beta of 1.4, Stock S has a beta of 0.65, the required return on an average stock is 9%, and the risk-free rate of return is 5%. By how much does the required return on the riskier stock exceed the required return on the less risky stock? Round your answer to two decimal places.

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2. You buy GBT for $56. One year later, you collect a dividend of $3 and sell the share for $51. What is your percent capital gain on this investment? Answer to 4 decimals,

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Financial Management: By how much does the required return on the riskier stock
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