If the expected return of the market portfolio is 10


A project has an expected cash flow of $1 million one year from now. The standard deviation of this cash flow is $250,000. If the expected return of the market portfolio is 10 percent, the risk-free rate is 5 percent, the standard deviation of the market return is 5 percent, and the correlation between this future cash flow and the return on the market is .5, what is the present value of the cash flow? Assume the CAPM holds.

Request for Solution File

Ask an Expert for Answer!!
Finance Basics: If the expected return of the market portfolio is 10
Reference No:- TGS02217567

Expected delivery within 24 Hours