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A stock has an expected return of 15.6%, the risk-free rate is 3.9%, and the market risk premium is 6.8%. What must the beta of
A stock has an expected return of 15.6%, the risk-free rate is 3.9%, and the market risk premium is 6.8%.
- What must the beta of this stock be? Show your work (12marks)
- What does beta measure? (2marks)
- Explain your calculated result from a). (6marks)
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Fundamentals of Financial Management
Authors: Eugene F. Brigham, Joel F. Houston
Concise 6th Edition
324664559, 978-0324664553
