Assume that the risk-free rate is 2.5% and the expected return on the market is 12%. What is the required rate of return on a stock with a beta of 1.1?

12.95%

Explanation:

Given:

Risk-free rate (rRF) = 2.5%

Expected return on the market (rm) = 12%

Stock beta (bs) = 1.1

(rRF) + (rm - rRF)(bs)

0.025 + (0.12 - 0.025) (1.1)

0.025 + 0.095 (1.1)

0.025 + 0.1045

0.1295

12.95%

start by isolating the variable on one side by adding 43w^2 to both sides.   the equation will read:

25w^2+5=0

*subtract 5 from both sides*

25w^2=-5

*divide both sides by 25*

w^2=-1/5

*take the square root of both sides*

w=√(-1/5)

the square root of -1 is i.   the square root of 5 remains √5

the answer is i/√5.

hope this

the specific actions take by the fed. what the fed was attempting to do by taking these actions. the result of the actions taken by the fed