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4. You are given the following information on two securities, the market portfolio, and the risk-free rate in Table 4 Table 4: Security Market Line

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4. You are given the following information on two securities, the market portfolio, and the risk-free rate in Table 4 Table 4: Security Market Line Calculation Securities Expected Return Correlation with Market Standard Deviation 15.5% 9.2 12.0 5.0 90 80 1.0 0.0 20% 9.0 12.0 0.0 Market Portfolio Riskfree Rate (a) Draw the security market line (SML) (b) What are the betas of the two securities. (c) Plot the two securities on the SML

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