7. Manipulating CAPM Use the basic equation for the capital asset pricing model (CAPM) to...
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7. Manipulating CAPM Use the basic equation for the capital asset pricing model (CAPM) to work each of the following problems. a. Find the required return for an asset with a beta of 0.91 when the risk-free rate and market return are 7% and 12%, respectively. b. Find the risk-free rate for a firm with a required return of 20.838% and a beta of 1.89 when the market return is 15%. c. Find the market return for an asset with a required return of 17.206% and a beta of 1.33 when the risk-free rate is 9%. d. Find the beta for an asset with a required return of 8.630% when the risk-free rate and market return are 5% and 7.2%, respectively. a. The required return for an asset with a beta of 0.91 when the risk-free rate and market return are 7% and 12%, respectively, is %. (Round to two decimal places.) b. The risk-free rate for a firm with a required return of 20.838% and a beta of 1.89 when the market return is 15% is %. (Round to two decimal places.) c. The market return for an asset with a required return of 17206% and a beta of 1.33 when the risk-free rate is 9% is %. (Round to two decimal places.) d. The beta for an asset with a required return of 8.630% when the risk-free rate and market return are 5% and 7.2%, respectively is (Round to two decimal places.)
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