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2. Suppose you observe the following situation:- Security Beta Expected return 14.50% Pest Corp. 1.35 Rat Co. 1.04 11.80 a. Assume these securities are correctly

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2. Suppose you observe the following situation:- Security Beta Expected return 14.50% Pest Corp. 1.35 Rat Co. 1.04 11.80 a. Assume these securities are correctly priced. Based on the CAPM, what is the risk free rate? b. What is the expected return on the market

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