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2. Suppose that CAPM holds. The expected market return is 14 percent and the T-bill rate is 5 percent. a. What should be the expected

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2. Suppose that CAPM holds. The expected market return is 14 percent and the T-bill rate is 5 percent. a. What should be the expected return on a stock with beta = 0? b. What should be the expected return on a stock with beta=1? c. What should be the expected return on a portfolio made up of 50 percent T-bills and 50 percent market portfolio

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