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Tcecarenko [31]
3 years ago
15

The common stock of Flavorful Teas has an expected return of 14.31 percent. The return on the market is 9 percent and the risk-f

ree rate of return is 3.1 percent. What is the beta of this stock
Business
1 answer:
HACTEHA [7]3 years ago
5 0

Answer:

the beta of this stock is 1.90.

Explanation:

The Expected Return of a Equity stock is the cost of equity to the company.

The cost of equity can be determined by using the <em>Capital Asset Pricing Model</em> (CAPM) as follows :

Cost of Equity = Return on a risk free security + Beta × Market Risk Premium

Where,

Market Risk Premium = Return on Market -  Return on a risk free security

14.31 % = 3.10 % + Beta × (9.00 % - 3.10 %)

14.31 % = 3.10 % + Beta × 5.90 %

11.21 % = Beta × 5.90 %

Beta = 1.90

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6 0
3 years ago
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8 0
4 years ago
interest rate is 7% and doubling time is 10.2 years. you have invested $5,000.00. in how many years will your money $40.000.00?
LenKa [72]
A = P (1 + I)^n
40000 = 5000 (1 + 0.07)^n
(1.07)^n = 40000/5000 = 8
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6 0
3 years ago
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AlladinOne [14]

Answer:

The answer is A.

Explanation:

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8 0
3 years ago
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With regards to this Barney's retained earnings as of December 31, 2021, would neither be understated or overstated but would be unaffected.

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3 years ago
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