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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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Financial management theory and practice
Authors: Eugene F. Brigham and Michael C. Ehrhardt
13th edition
1439078106, 111197375X, 9781439078105, 9781111973759, 978-1439078099
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