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Consider a multifactor (APT) model of a stock depending on the following factors: Inflation (expected...

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Finance

Consider a multifactor (APT) model of a stock depending on the following factors: Inflation (expected value = 5%, actual value = 4%, beta = 1.2), Industrial production (expected value = 3%, actual value = 6%, beta = 0.5), and Oil prices (expected value = 2%, actual value = 0%, beta =0.3). The expected return on the stock = 18.1% and the risk-free rate = 6%. What would be the revised expected rate of return on the stock?

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