Capm req rate of return mathys corporations stock had a, Ask an Expert

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CAPM: req. rate of return Mathys Corporation's stock had a required return of 9.60% last year, when the risk-free rate was 3.00% and the market risk premium was 5.50%. Then an increase in investor risk aversion caused the market risk premium to rise by 1.50% from 5.50% to 7.00%. The risk-free rate and the firm's beta remain unchanged. What is the company's new required rate of return?

a. 10.00%

b. 10.70%

c. 11.40%

d. 12.80%

e. 13.50%

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Financial Management, Finance

Category:- Financial Management
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