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lawyer [7]
3 years ago
15

Try to determine the required rate of return on Tilden Woods Corporation’s common stock. The firm’s beta is 1.53. The rate on a

10-year Treasury bond is 2.59 percent, and the market risk premium is 7.25 percent. Round the answers to two decimal places in percentage form.
Business
1 answer:
Scorpion4ik [409]3 years ago
7 0

Answer:

The required rate of return is 13.68%.

Explanation:

Using the CAPM or Capital Asset Pricing Model, we can calculate the required rate of return (r) of the stock of Tilden Woods Corporation.

The formula for required rate of return (r) under CAPm is:

r = rRF + beta *  rpM

Where,

  • rRF is the risk free rate or T Bond rate
  • Beta is the stock's beta which is a measure of risk
  • rpM is the market risk premium

Thus, r = 2.59% + 1.53 * 7.25% = 13.68%

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Suppose you found a CD that pays 4.9% interest compounded monthly for 4 years. If you deposit $10,000 now, how much will you hav
Katyanochek1 [597]

Answer:

=$11,580.00

Explanation:

The CD pays 4.9 percent compounded monthly for four years.

In one year, there will be 12 occasions of compounding; after four years, there would be 12 x 4 = 36 compounds.

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The amount in four years is the same as the future value after four years.

=FV = PV (1+r)n

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4 0
3 years ago
During regular economic times in Canada, the maximum length of time a worker can collect employment insurance is 26 weeks. Durin
DochEvi [55]

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7 0
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Question 3 Fill in the blank: Curiosity, understanding context, having a technical mindset, data design, and data strategy are _
vladimir1956 [14]

When one is said to have curiosity, an ability to understand context, and a technical mindset, they have <u>analytical skills.</u>

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