Cengage Digital Learningx deltastate.instructure.com/courses/25110/quizzes/52052

Question

Cengage Digital Learningx deltastate.instructure.com/courses/25110/quizzes/52052/take D Question 14 6 pts Suppose the real risk-free rate is 3.50%, the average future inflation rate is 2.25%, and a maturity premium of 0.10% per year to maturity applies ie.. MRP-010, what rate of return would you expect on a 1-year (short term) Treasury security? 0 595% 6.05% O 5.75% > 5.85% Question 15 6 pts An analyst has estimated how a particular stock's return will vary depending on what will happen to the cconomy. What is the cxpected rate of return of the company's stock? OF THE PROBABILITY OF STOCK'S ECONOMY STATE EXPECTED RATE IF THIS STATE OCCURS OCCURRING

Explanation / Answer

RATE OF RETURN

=real risk free rate+inflation+MRP

=3.50%+2.25%+1*0.10%

=5.85%

THE ABOVE SHOULD BE ANSWER..

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