Plaid Pants, Inc. common stock has a beta of 0.90, while Acme Dynamite Company common stock has a beta of 1.80. The expe
Posted: Tue Mar 08, 2022 3:36 pm
Plaid Pants, Inc. common stock has a beta of 0.90, while Acme Dynamite Company common stock has a beta of 1.80. The expected return on the market is 10 percent, and the risk-free rate is 6 percent. According to the capital-asset pricing model (CAPM) and making use of the information above, the required return on
Plaid Pants' common stock should be , and the required return on Acme's common stock should be .
A. 3.6 percent; 7.2 percent
B. 9.6 percent; 13.2 percent
C. 9.0 percent; 18.0 percent
D. 14.0 percent; 23.0 percent
Plaid Pants' common stock should be , and the required return on Acme's common stock should be .
A. 3.6 percent; 7.2 percent
B. 9.6 percent; 13.2 percent
C. 9.0 percent; 18.0 percent
D. 14.0 percent; 23.0 percent