Calculate the required rate of return for climax inc., assuming that (1) investors expect a 4.0% rate of inflation in the future, (2) the real risk-free rate is 3.0%, (3) the market risk premium is 5.0%, (4) the firm has a beta of 2.30, and (5) its realized rate of return has averaged 15.0% over the last 5 years. do not round your intermediate calculations.

Required rate of return = 18.5 %

Explanation:

given,                            

rate of inflection = 4 %

risk free rate = 3 %                      

market risk premium = 5 %                    

firm has a beta  = 2.30                                  

rate of return has averaged 15.0% over the last 5 years

now,                                                                      

Nominal risk free rate = risk free rate  + inflation

                                    = 3%  +  4%

                                   = 7%

Required rate of return = Nominal risk free rate + β (RPM)

                                       = 7%       +          2.3 x 5.0%

Required rate of return = 18.5 %

it's when something is going so fast it makes a loud noise, breaking the sound barrier, for example: a jet makes a loud noise, not only cause of the jet but because they reached a point where they went so fast that you can year the noise from various parts, kinda like a police car, lets say the car was going   so fast that you hear the siren of the cop car right next to you, but the car is probably a mile a way, it's cos the siren was next to you a few seconds if you understand me