(c)100 pts mrs. carothers looked at another hotel. she waited a week before she decided to book nights at that hotel, and now the prices have increased. the original price was $1195. the price for the same room and same number of nights is now $2075. what is the percent increase? round to the nearest whole percent. explain and show your work.

required rate of return = 0.166 = 16.6%

step-by-step explanation:

under the capital asset pricing model (capm), the required or expected rate of return for a particular security or asset is given using the formula:

required rate of return = risk-free rate + beta*(market risk premium)

we are given that;

risk-free rate = 4% = 0.04

beta = 1.4

market risk premium = 9% = 0.09

we simply plug these values into the above formula;

required rate of return = 0.04 + 1.4*(0.09)

required rate of return = 0.04 + 0.126

required rate of return = 0.166 = 16.6%