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5. Compute and report the cost of equity of intercontinental hotels group plc (i.e. rate of return required by the shareholders) using the Capital Asset

5. Compute and report the cost of equity of intercontinental hotels group plc (i.e. rate of return required by the shareholders) using the Capital Asset Pricing Model (CAPM). You may assume that the rates of return on the market and on the risk-free rate are 8% and 2%, respectively. The beta of the firm can be found in Yahoo! Finance within the Key Statistics section and in the FAME database. Discuss the relation between the market risk of the firm and the cost of equity.

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