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5. Now use the CAPM/SML Equation to estimate each stock's required return. Use 9.5% as the required market return and the recent 10-year Treasury

 

5. Now use the CAPM/SML Equation to estimate each stock's required return. Use 9.5% as the required market return and the recent 10-year Treasury rate of 2.3% as the risk- free rate. Would you recommend buying IBM and/or Netflix if your APR average for each stock from #2 is your expected return? Explain your answer. Netflix IBM Expected Return 5.49 8.49

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