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6. Problem 8.11 (CAPM and Required Return) eBook Problem Walk-Through Calculate the required rate of return for Mudd Enterprises assuming that investors expect a 4.2%

6. Problem 8.11 (CAPM and Required Return) eBook Problem Walk-Through Calculate the required rate of return for Mudd Enterprises assuming that investors expect a 4.2% rate of inflation in the future. The real risk-free rate is 1.0%, and the market risk premium is 6.5%. Mudd has a beta of 2.4, and its realized rate of return has averaged 8.0% over the past 5 years. Round your answer to two decimal places. %

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