Expected rate of return on a stock


Problem:

The risk-free rate of return is 4 percent and the market risk premium is 8 percent.

Required:

Question: What is the expected rate of return on a stock with a beta of 1.28?

  • 14.24
  • 9.12
  • 10.24
  • 13.12
  • 15.36

Note: Provide thorough explanation of every question given in the problem.

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Accounting Basics: Expected rate of return on a stock
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