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17. Suppose the Canadian Pasific Railway has a beta of 1.32, whereas the beta of Loblaw Companies Limited is 0.58. If the risk-free interest rate

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17. Suppose the Canadian Pasific Railway has a beta of 1.32, whereas the beta of Loblaw Companies Limited is 0.58. If the risk-free interest rate is 3%, and the market risk premium is 6%, what is the expected return of an equally weighted portfolio of Canadian Pacific and Loblaw? A. 6.48%. B. 9.70%. C. 10.92%. D. 16.50%. E. None of the above. w

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