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Answer the following questions. Assume the yield curve is flat and the T-bill rate is 5%. The market return rate is 10%. The required rate
Answer the following questions. Assume the yield curve is flat and the T-bill rate is 5%. The market return rate is 10%. The required rate of return for Stock A is 11.3%. An investor is forming a portfolio by investing $50,000 in stock A and $25,000 in stock B. Stock B has a beta of 0.90. Determine which beta coefficient for Stock A is consistent with equilibrium. Select one: a. 1.10 O O b. 0.80 c. 1.35 d. 1.26 e. 0.86 O Continued from previous question. What is the required rate of return on the investor's portfolio? Select one: O a. 10.70% O b. 9.05% c. 10.15% d. 10.00% e. 6.80%
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