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af Question 33 (3 marks) Consider the following information about Stocks A and B. The market risk premium is 7%, and the
Posted: Mon May 30, 2022 7:19 am
by answerhappygod
- Af Question 33 3 Marks Consider The Following Information About Stocks A And B The Market Risk Premium Is 7 And The 1 (38.79 KiB) Viewed 24 times
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Question 33 (3 marks) Consider the following information about Stocks A and B. The market risk premium is 7%, and the risk-free rate is 3% Rate of Return if State Occurs State of economy Probability of state of economy Stock A Stock B 0.02 0.15 0.25 Recession 0.70 Normal 0.21 0.09 Irrational exuberance 0.16 0.06 0.44 What are the approximate betas for Stocks A and B? a 1.843 and 0.879 b. 1.990 and 1.865 c. 0.989 and 1.225 d. 2.000 and 1.500 O Ob. Oc. O d.