Stock A has a required return of 19 percent. Stock B has a required return of 11 percent. Assume a risk-free rate of 4.75 percent. Which of the following is a correct statement about the two stocks? Stock A is riskier. Stock B is riskier. The stocks have the same risk. We would need to know if the markets are efficient to answer this question

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24-11-2022
Business

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Stock A has a required return of 19 percent. Stock B has a required return of 11 percent. Assume a risk-free rate of 4.75 percent. Which of the following is a correct statement about the two stocks? Stock A is riskier. Stock B is riskier. The stocks have the same risk. We would need to know if the markets are efficient to answer this question

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GouravDayma GouravDayma · Answer 1 · 2022-11-26T09:59:18+01:00

Stock A is risky than Stock B because its risk premium, which is computed as 19% minus 4.75 percent, equals 14.25 percent.

How do you explain stock?

Stock are indeed a type of protection that gives owners a stake in a company. One name of stocks is "equities."

National riches, national capital, the money supply, and other examples of stock.

What separate stocks from shares?

A financial instrument known as a share symbolises a company's partial ownership. A financial instrument called a stock reflects partial ownership in one or even more companies. A company's shares can have different values that are equal to one another.

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