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Finance, identify the beta listed for the stocks of four companies: a food service (restaurant) company called Denny's Corporation (stock symbol DENN), Amazon (AMZN), Caterpillar Inc. (CAT), and Waste Management (WM).

Apply the Capital Asset Pricing Model (CAPM) Security Market Line to estimate the required return on Caterpillar stock.

Assumptions and Data: Note that you will need an estimate of the risk-free rate, rRF, and the market risk premium. Assume a 5% market risk premium and use the current yield on 10-year Treasury securities as an estimate of the risk-free rate. You can yields on Treasury securities from the section of “Market Data” on Finance!Yahoo’s frontpage.

Financial Management, Finance

  • Category:- Financial Management
  • Reference No.:- M92727103

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