Q1) Required rate of return suppose that risk-free rate is 6% and expected return on market is 13%. Determine the required rate of return on the stock with a beta of 0.7?
Q2) Beta and required rate of return stock has required return of 11%; risk-free rate is 7%t; and market risk premium is 4 %.
a) Determine the stock's beta?
b) Is market risk premium increased to 6%, what would occur to stock's required rate of return?
Suppose risk-free rate and beta remain unchanged
Q3) 4 research participants take test of manual dexterity (high scores mean better dexterity) and the anxiety test (high scores mean more anxiety). Scores are as follows:
|
Person
|
Dexterity
|
Anxiety
|
|
1
|
1
|
10
|
|
2
|
1
|
8
|
|
3
|
2
|
4
|
|
4
|
4
|
-2
|
Figure whether correlation is statistically significant (use the: 05 significance level, two-tailed).