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A security is fairly priced under CAPM and you have estimated its expected return to be 12.6%. If you can invest in a risk-free asset
A security is fairly priced under CAPM and you have estimated its expected return to be 12.6%. If you can invest in a risk-free asset at 5.3% and the beta of your security is 0.79, the risk premium demanded by the investors to invest in the market portfolio is
a) 8.98%
b) 12.83%
c) 14.54%
d) 9.24%
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