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If the required rate of return is 11 the risk free rate is 7 and the market risk premium is 4 If the market risk premium increased to 6 percent what would happen to the stocks required rate of return?
RoR = Rf + beta x Rp where, RoR = Required Rate of return Rf = Risk free Rate Rp = Risk Premium so Ror - 19%
4.5 + 5.00= 9.5 9.5 X 1.2= 11.4
expected market return = risk free + beta*(market return - risk free) So by putting in values: 20.4 = rf+ 1.6(15-rf) expected market return = risk free + beta*(market return - risk free) So by putting in values: 20.4 = rf+ 1.6(15-rf) where rf = risk free 20.4 - 24 = rf - 1.6rf -3.6 = -0.6rf rf = 6
E (return) = Rf + Beta[Rm - Rf] = 6 + (7) (13-6) = 55 %
Generics' share of the prescription drug market was expected to increase from 22 percent in 1985 to more than 66 percent by the turn of the century.
2.0%
This should be correct in a perfect market. Not true usually as assets are often mis priced. Expected return is the return/discount that market is using to get the value of the asset while required return is the discount / return that gets you the true intrinsic value of an asset
If the required rate of return is 11 the risk free rate is 7 and the market risk premium is 4 If the market risk premium increased to 6 percent what would happen to the stocks required rate of return?
Expected return= risk free rate + Risk premium = 11 rate of return on stock= Riskfree rate + beta x( expected market return- risk free rate)
Through 2000, the market was expected to grow by 5.1 percent to $28.0 billion.
In the late 1990s, sales to Canada represented 20 percent of the market; 15 percent for Mexico; 11 percent to the Dominican Republic; and 7 percent to Japan. Exports were expected to increase 6 percent annually through 2002.
You must have a Bachelor's degree in order for you to become a market analyst. With that in mind the job outlook for a market analyst is expected to grow 41% in the next 7 years.
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$140
RoR = Rf + beta x Rp where, RoR = Required Rate of return Rf = Risk free Rate Rp = Risk Premium so Ror - 19%
11.51%