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3. work out this exercise on risk and return. Suppose you observe the following situation as depicted in the table below. If the risk-free rate

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3. work out this exercise on risk and return. Suppose you observe the following situation as depicted in the table below. If the risk-free rate is 8%, are these securities correctly priced? What would the risk-free rate have to be if they are correctly priced? BETA EXPECTED RETURN Cooley, Inc. 1.6 19% Moyer Co. 12 16%

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