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2. The ordinary shares of Mumford Quilt Company have a beta of 1.1. If the expected risk-free return is 4.5 percent and the market offers

2. The ordinary shares of Mumford Quilt Company have a beta of 1.1. If the expected risk-free return is 4.5 percent and the market offers a premium of 6.5 percent over the risk-free rate, using the CAPM what is the expected return on Mumford Quilts' ordinary shares?

a. 11.65% b. 7.6% c. 13.4% d. 15.4%

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