Question
ABC stock has a beta of 2. The expected return on the stock market, E(R M ), is 9 percent. The risk-free interest rate is
ABC stock has a beta of 2. The expected return on the stock market, E(RM), is 9 percent. The risk-free interest rate is 3 percent. If the stock is on the
security market line it has an expected return, E(RABC), of _____.
| a) | 21% | |
| b) | 27% | |
| c) | 12% | |
| d) | 15% |
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Money And Capital Markets
Authors: Peter Rose, Milton Marquis
10th Edition
0077235800, 9780077235802
