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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 is10 percent, and the risk-free rate is6 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.

 

3.6 percent;7.2 percent

 

9.6 percent;13.2 percent

 

9.0 percent;18.0 percent

 

14.0 percent;23.0 percent

Accounting ERP Audit Management Project Management Management
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Question added by Emad Mohammed said abdalla , ERP & IT Software, operation general manager . , AL DOHA Company
Date Posted: 2015/03/24
Upvote (3) Views (23) Followers (9) Answers (9) Report Question
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Mir Mujtaba Ali
by Mir Mujtaba Ali , Internal Audit Manager , Confidential

Agree with Mr. Emad.................

Plaid's required return =0.06 + [(0.90)(0.10 -0.06)] =0.096Acme's required return =0.06 + [(1.8)(0.10 -0.06)] =0.132

khaled elkholy
by khaled elkholy , HR MANAGER , misk for import & export

Agree with all friends ............................

Khaled Anwar
by Khaled Anwar , Senior Sales Engineer , "Automotive company''

I think the answer is :9.6 percent;13.2 percent

Bello Abubakar
by Bello Abubakar , Cinema 4D Render/Sketch UP, AutoCAD, ArchiCAD and Revit Specialist , Federal Housing Authority

following my mentor...wasi rahman..........................

Vinod Jetley
by Vinod Jetley , Assistant General Manager , State Bank of India

9.6 percent;13.2 percent is the correct answer

Hany Helmy Haleem
by Hany Helmy Haleem , Director of Warehouses , Nasco Automotive

The answer is : 9.6 percent;13.2 percent

Best regards

 

Wasi Rahman Sheikh
by Wasi Rahman Sheikh , WAREHOUSE SUPERVISOR , AL MUTLAQ FURNITURE MFG

Agreed with Experts answer <<<<<<<<<

Ayoub Tartir , PMP, GWCPgM, CISA, CISSP, CAP, CSSLP, FITSP-D, CEH, CHFI, CCNA, CCNA Security, Security+, Network+

My answer is also option (B)9.6%;13.2%

Emad Mohammed said abdalla
by Emad Mohammed said abdalla , ERP & IT Software, operation general manager . , AL DOHA Company

>>>>>>>>>>>>>9.6 percent;13.2 percent

 

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