Cost of common stock equity-capm jm corporation common, Finance Basics

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Cost of common stock equity-capm jm corporation common

Question: Cost of common stock equity-CAPM J&M Corporation common stock has a beta b, of 1.7. The risk-free rate is 7%, and the market return is 14%

a. Determine the risk premium on J&M common stock.

b. Determine the required return that J&M common stock should provide.

c. Determine J&M's cost of common stock equity using the CAPM.

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