Consider the Information Below for Postman Builders Inc A)1400%
B)14

question 23

Multiple Choice

Consider the information below for Postman Builders Inc.Suppose that the expected inflation rate and thus the inflation premium increase by 2.0 percentage points,and Postman acquires risky assets that increase its beta by the indicated percentage.What is the firm's new required rate of return? $$\begin{array} { l r } \text { Beta: } & 1.50 \\\text { Required return } \left( \mathrm { r } _ { \mathrm { s } } \right) & 10.20 \% \\\text { RPM: } & 6.00 \% \\\text { Percentage increase in beta: } & 20 \%\end{array}$$

• A)14.00%
• B)14.70%
• C)15.44%
• D)16.21%
• E)17.02%

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Definitions:

Binary Mixture

A mixture composed of only two components or substances in any proportion, without any chemical bonding.

Gunpowder

A mixture of saltpeter, sulfur, and charcoal, used historically as a propellant in firearms and fireworks.

Isomer

Molecules with the same molecular formula but different structural arrangements.