Quantitative Problem: You are given the following information for Wine and Cork Enterprises (WCE):
rRF = 3%; rM = 10%; RPM = 7%, and beta = 1.1
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' market risk premium, 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 market risk premium increases by 2%. What is WCE's required rate of return now? Round your answer to two decimal places. Do not round intermediate calculations.%
If inflation increases by 1% and market risk premium increases by 2%, what is WCE's required rate of return now? Round your answer to two decimal places. Do not round intermediate calculations.%
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