CAPM beta of sharesForums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FM Exams › CAPM beta of sharesThis topic has 1 reply, 2 voices, and was last updated 2 years ago by John Moffat.Viewing 2 posts - 1 through 2 (of 2 total) AuthorPosts May 30, 2021 at 9:03 pm #622347 LWitchlowMemberTopics: 1Replies: 0☆On chapter 20 FM practice questions, how do you get 5% x beta = 6% when you are trying to work out the beta? May 31, 2021 at 8:25 am #622381 John MoffatKeymasterTopics: 56Replies: 53802☆☆☆☆☆I am guessing that you are referring to Q3 (but please do say which question in future!!).5% is the equity risk premium (which is the market return less the risk free rate – the market return is therefore 9%).So using the normal CAPM formula, 10% = 4% + (beta x 5%)Therefore 6 = 5 x BetaBeta = 6/5 = 1.2AuthorPostsViewing 2 posts - 1 through 2 (of 2 total)You must be logged in to reply to this topic.Log In Username: Password: Keep me signed in Log In