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Answer the following questions. What is the market risk premium? ** You are an investor in common stock, and you currently hold a well-diversified portfolio
Answer the following questions. What is the market risk premium? ** You are an investor in common stock, and you currently hold a well-diversified portfolio which has a required return of 12%, a beta of 1.2, and a total value of $9,000 ** You plan to increase your portfolio by buying 100 shares of AT&E at $10 a share. AT&E has a beta of 1.8. ** The current T-bill rate is 5%. Select one O a. 5.83% O b. 9.0% O c. 6.67% od 4.0% O e. 12.15% Continued from previous question. What will be the required return of your portfolio after you purchase the new stock? Select one: O a. 16.17% O b. 9.00% O c. 12.54% d. 12.35% O e. 10.67%
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