4 The all-equity financed Lasar plc has a Beta of 0.8. What rate of return should it seek on new investment:

(i) with similar risk to existing activities?

(ii) with 25 per cent greater risk compared to existing activities?

(iii) with 25 per cent lower risk compared to existing activities?

The risk-free rate of interest is 6 per cent, and the expected return on the market portfolio is 11 per cent.