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Assume both portfolios A and B are well diversified, that E ( r A ) = 13.4% and E ( r B ) = 15.0%

Assume both portfoliosAandBare well diversified, thatE(rA) = 13.4%andE(rB) = 15.0%. If the economy has only one factor, andA= 1whileB= 1.2, what must be the risk-free rate?(Do not round intermediate calculations. Round your answer to 1 decimal place.)

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