The Relevant Risk-Free Rate Is 5%, and the Equity Premium

question 62

Multiple Choice

The relevant risk-free rate is 5%, and the equity premium has averaged 9% in recent years. Your project has an estimated beta of 1.12. What rate of return should you require on this
Project? Round your answer to the nearest tenth of a percent.

• A)14.6%
• B)5.1%
• C)15.1%
• D)9.5%

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