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2 . 2 ) The market return, based on a broad market index ( i . e . the S&P 5 0 0 ) ,

2.2) The market return, based on a broad market index (i.e. the S&P 500), is estimated to be 8%. Calculate Company ABCs required return if the risk-free rate is 1% and the stocks beta is 1.25(round your answer to two decimal places).1)Describe the assumptions related to the problem: 2) Apply the appropriate mathematical model: 3) Calculation:

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