Business, 03.12.2019 01:31 pablogamohunndo

Mikkelson corporation's stock had a required return of 12.50% last year, when the risk-free rate was 3% and the market risk premium was 4.75%.
then an increase in investor risk aversion caused the market risk premium to rise by 2%. the risk-free rate and the firm's beta remain unchanged.

what is the company's new required rate of return?

(hint: first calculate the beta, then find the required return.) do not round your intermediate calculations.

a. 16.50%

b. 13.04%

c. 12.87%

d. 12.71%

e. 14.36%

Answers: 3

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