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a. What rate of return should an investor expect for a stock that has a beta of 0.8 when the market is expected to yield
a. What rate of return should an investor expect for a stock that has a beta of 0.8 when the market is expected to yield 14% and Treasury bills offer 6%?
9.2% | ||
11.2% | ||
12.4% | ||
12.8%
|
b. The intercept of the security market line is the rate of return which corresponds to:
the risk-free rate. | ||
the market rate of return. | ||
a value of 1.0. | ||
the market risk premium |
please answer both parts
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