Acme Enterprises has a beta of 1.25. The historic return of the S&P500 has been 10.12% per year, and 3-month T-bills have returned 3.56% per year compounded annually. Using these historic returns as predictors of future returns, what the required return [or expected return] of Acme Enterprises?

Select one:

a. More than 12.0%

b. Less than 9.0 percent

c. 11.0 percent to 12.0 percent

d. 10.0 percent to 11.0 percent

e. 9.0 percent to 10.0 percent