Question
4. Suppose r RF = 9%, r M = 14%, and b i = 1.3. a. What is r i , the required rate of
4. Suppose r RF = 9%, r M = 14%, and b i = 1.3.
a. What is r i , the required rate of return on Stock i?
b. Graph the SML.
c. Now suppose r RF increases to 10% while the slope of the SML remains constant.
How would this affect r M and r i ?
d. Graph the new SML.
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Dividend Growth Investing Machine
Authors: Andrew P.C.
1st Edition
1521728461, 978-1521728468
