Quantitative Problem: You are given the following information for Wine and Cook Enterprises (WCE):
rRf= 4%; rM= 7%; RPm= 3%, and beta = 1
What is WCE's required rate of return? Round your answer to 2 decimal places. Do not round intermediate calculations. ____%
If inflation increases by 1% but there is no change in investors' risk aversion, what is WCE's required rate of return now? Round your answer to two decimal places. Do not round intermediate calculations. ___%
Assume now that there is no change in inflation, but risk aversion increases by 2%. What is WCE's required rate of return now? Round your answer to two decimal places. Do not round intermeiate calculations. ____%
If inflation increases by 1% and risk aversion increases by 2%, what is WCE's required rate of return now? Round your asnwer to two decimal places. Do not round intermediate calculations. ____%