Beta, Risk Free Rate and Expected Return
Statistical Calculations for Initiation into the Cardinal Club
July 9, 2019Descriptive Statistics
July 9, 2019Holup, Inc., makes pneumatic equipment. The beta of Holup’s stock is 1.2. The expected market risk premium is 8.5 percent, and the current risk-free rate is 6 percent. Assume the capital-asset-pricing model holds. What is the expected return on Holup’s stock?
Beta, risk free rate and expected return are investigated. The solution is detailed and well presented. The response received a rating of “5/5” from the student who originally posted the question.
