What would happen to the stocks required rate of return


Question 1: A stock has a required return of 11%, the risk-free rate is 7%, and the market risk premuim is 4%.

A. What is the stock's beta?

B. If the market risk premium increased to 6%, what would happen to the stock's required rate of return? Assume that the risk-free rate and the beta remain unchanged.

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Finance Basics: What would happen to the stocks required rate of return
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