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(1) ExxonMobil has a beta of 1.4. The risk-free rate of return is 3.8 percent and your estimate of the market risk premium is 9
(1) ExxonMobil has a beta of 1.4. The risk-free rate of return is 3.8 percent and your estimate of the market risk premium is 9 percent. Given the above information, what is it expected return of ExxonMobil, according to the Capital Asset Pricing Model (CAPM)? A) 14.8% B) 15.6% C) 16.4% D) 17.2% (2) The beta of Treasury bills is A) +1.0. B) +0.5. C) -1.0. D) 0.0. (3) What is the graphical representation of the CAPM (capital asset pricing model) known as: A) capital market line. B) characteristic line. C) security market line. D) None of the options are correct
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