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A stock you are holding has a beta of 2.0 and the stock is currently in equilibrium. The required rate of return on the stock
A stock you are holding has a beta of 2.0 and the stock is currently in equilibrium. The required rate of return on the stock is 15% versus a required return on an average stock of 10%. Now the required return on an average stock increases by 25.0% (not percentage points). The risk-free rate is unchanged. By what percentage (not percentage points) would the required return on your stock increase as a result of this event?
Select the correct answer. a. 33.33% b. 33.21% c. 33.29% d. 33.25% e. 33.37%
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