At Westonci.ca, we connect you with the answers you need, thanks to our active and informed community. Our platform provides a seamless experience for finding reliable answers from a knowledgeable network of professionals. Connect with a community of professionals ready to help you find accurate solutions to your questions quickly and efficiently.
Sagot :
Answer:
9.00%
Explanation:
In a bid to determine the market return, we make use of the formula for average return provided below whereby the formula is rearranged in order to market return the subject of the formula as shown thus:
Average return = Alpha + rf + β * (rm - rf)
Average return=12%
Alpha=0.6%
rf=risk-free rate=3%
β=Beta=1.4
rm=market return=the unknown
12%=0.6%+3%+1.4*(rm-3%)
12%=0.6%+3%+1.4rm-4.20%
12%=3.6%+1.4rm-4.20%
12%-3.6%+4.20%=1.4rm
12.60%=1.4rm
rm=12.60%/1.4
rm=9.00%
Thank you for your visit. We're committed to providing you with the best information available. Return anytime for more. We hope you found what you were looking for. Feel free to revisit us for more answers and updated information. Get the answers you need at Westonci.ca. Stay informed with our latest expert advice.
