Your Estimate of the Market Risk Premium Is 7

question 104

Multiple Choice

Your estimate of the market risk premium is 7%. The risk-free rate of return is 4% and General Motors has a beta of 1.6. What is General Motors' cost of equity capital?

• A) 15.2%
• B) 14.4%
• C) 16.0%
• D) 13.7%

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