Halestorm Corporation’s common stock has a beta of 1.29. Assume the risk-free rate is 5.4 percent and the expected return on the market is 12.9 percent.

R = Rf + b(Rm - Rf), or

R = 5.4% + 1.29 (12.9% - 5.4%) = 5.4% + 1.29 (7.5%) = 15.075%

Halestorm Corporation’s common stock has a beta of 1.29. Assume the risk-free rate is 5.4 percent and the expected return on the market is 12.9 percent.