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7. On page 97, the Tax-adjusted SML slope is indicated as E(r m ) r f * (1 - T c ), but in cell
7. On page 97, the Tax-adjusted SML slope is indicated as E(rm ) rf * (1 - Tc),
but in cell B8 of page 101, it is actually calculated as RP + rf * Tc (where RP =
E(rm ) rf). Show that the former is equal to the latter, with the steps. (1 point)
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