Porter plumbing's stock had a required return of 14.50% last year, when the risk-free rate was 5.50% and the market risk premium was 4.75%. then an increase in investor risk aversion caused the market risk premium to rise by 2%. the risk-free rate and the firm's beta remain unchanged. what is the company's new required rate of return? (hint: first calculate the beta, then find the required return.) s
select the correct .
a. 18.29%
b. 17.29%
c. 17.79%
d. 18.79%
e. 19.29%
fiske roofing supplies' stock has a beta of 1.23, its required return is 9.50%, and the risk-free rate is 4.30%. what is the required rate of return on the market? (hint: first find the market risk premium.)
select the correct answer.
a. 8.53%
b. 8.38%
c. 8.43%
d. 8.48%
e. 8.58%
bartlett company's target capital structure is 40% debt, 15% preferred, and 45% common equity. the after-tax cost of debt is 6.00%, the cost of preferred is 7.50%, and the cost of common using reinvested earnings is 12.75%. the firm will not be issuing any new stock. you were hired as a consultant to determine their cost of capital. what is its wacc?
a. 8.98%
b. 10.12%
c. 9.54%
d. 9.26%
e. 9.83%
portfolio required return
suppose you manage a $4.865 million fund that consists of four stocks with the following investments:
stock investment beta
a $420,000 1.50
b 575,000 -0.50
c 1,420,000 1.25
d 2,450,000 0.75
if the market's required rate of return is 9% and the risk-free rate is 6%, what is the fund's required rate of return? do not round intermediate calculations. round your answer to two decimal places.