Cost of common stock equitylong dash—CAPM
? J&M Corporation common stock has a? beta, b?, of 1.1. The? risk-free rate is 7%?, and the market return is 11?%.
a. Determine the risk premium on? J&M common stock.
b. Determine the required return that? J&M common stock should provide.
c. Determine? J&M's cost of common stock equity using the CAPM.