What is the expected return of the overal market based on


a. Given the following information, please compute the expected return for Herbco:

10-year Treasury yield: 1.7%

10-year AAA Corporation Bond yield: 2.2%

5-year weekly beta for company stock: 1.40

Estimated Equity Risk Premium: 5.5%

Last 12-month change in the S&P 500 Index: 8.0%

(The answer to this part is 9.4%, I am just unsure how to achieve this solution)

b. What is the expected return of the overall market based on this information?

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Financial Management: What is the expected return of the overal market based on
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