What is the required return for the overall stock market


CAPM AND REQUIRED RETURN

Calculate the required rate of return for Mudd Enterprises assuming that investors expect a 3.6% rate of inflation in the future. The real risk-free rate is 1%, and the market risk premium is 7%. Mudd has a beta of 1.8, and its realized rate of return has averaged 15% over the past 5 years. Round your answer to two decimal places. %

EXPECTED AND REQUIRED RATES OF RETURN

Assume that the risk-free rate is 7% and the market risk premium is 5%.

What is the required return for the overall stock market? Round your answer to two decimal places. %

What is the required rate of return on a stock with a beta of 0.9? Round your answer to two decimal places. %

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Financial Management: What is the required return for the overall stock market
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